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                                                                    EXHIBIT 4.03

                                    BYLAWS OF

                               CREE RESEARCH, INC.
                      (AS AMENDED THROUGH NOVEMBER 1, 1999)


                                    ARTICLE I

                                   DEFINITIONS

         In these bylaws, unless otherwise provided, the following terms shall
have the following meanings:

                  (1) "Act" shall mean the North Carolina Business Corporation
Act as codified in Chapter 55 of the North Carolina General Statutes effective
July 1, 1990, and as amended from time to time;

                  (2) "Articles of Incorporation" shall mean the Corporation's
articles of incorporation, including amended and restated articles of
incorporation and articles of merger;

                  (3) "Corporation" shall mean Cree Research, Inc.;

                  (4) "Distribution" shall mean a direct or indirect transfer of
money or other property (except the Corporation's own shares) or incurrence of
indebtedness by the Corporation to or for the benefit of its shareholders in
respect of any of its shares. A distribution may be in the form of a declaration
or payment of a dividend, a purchase, redemption, or other acquisition of
shares, a distribution of indebtedness, or otherwise;

                  (5) "Emergency" shall mean a catastrophic event which prevents
a quorum of the board of directors from being readily assembled;

                  (6) "Shares" shall mean the units into which the proprietary
interests in the Corporation are divided; and

                  (7) "Voting group" shall mean all shares of one or more
classes or series that under the Articles of Incorporation or the Act are
entitled to vote and be counted together collectively on a matter at a meeting
of shareholders. All shares entitled by the Articles of Incorporation or the Act
to vote generally on a matter are for that purpose a single voting group.


                                   ARTICLE II

                                     OFFICES

         SECTION 1. PRINCIPAL OFFICE: The principal office of the Corporation
shall be located at 4600 Silicon Drive, Durham County, Durham, North Carolina
27703, or at such other place as may be determined from time to time by the
directors.


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         SECTION 2. REGISTERED OFFICE: The registered office of the Corporation
shall be maintained in the State of North Carolina, and may be, but not need be,
identical with the principal office.

         SECTION 3. OTHER OFFICES: The Corporation may have offices at such
other places, either within or without the State of North Carolina, as the board
of directors may from time to time determine, or as the affairs of the
Corporation may require.


                                   ARTICLE III

                            MEETINGS OF SHAREHOLDERS

         SECTION 1. PLACE OF MEETINGS: All meetings of shareholders shall be
held at the principal office of the Corporation, or at such other place, either
within or without the State of North Carolina, as shall be designated in the
notice of the meeting or as may be agreed upon by a majority of the shareholders
entitled to vote at the meeting.

         SECTION 2. ANNUAL MEETING: The annual meeting of shareholders for the
election of directors and the transaction of other business shall be held
annually in any month on any day (except Saturday, Sunday or a legal holiday) as
fixed by the board of directors.

         SECTION 3. SUBSTITUTE ANNUAL MEETING: If the annual meeting shall not
be held on the day designated by these bylaws, a substitute annual meeting may
be called by the board of directors, the chairman or the president. A meeting so
called shall be designated and treated for all purposes as the annual meeting.

         SECTION 4. SPECIAL MEETINGS: Special meetings of the shareholders may
be called at any time by the board of directors of the Corporation or by the
chairman.

         SECTION 5. NOTICE OF MEETING: Written or printed notice stating the
time and place of the meeting shall be delivered not less than ten (10) nor more
than sixty (60) days before the date of any shareholders' meeting, either
personally, or by telephone, telegraph, teletype, mail, private carrier,
facsimile transmission, or other form of wire or wireless communication by or at
the direction of the chairman of the board, the president, the secretary, or
other person calling the meeting, to each shareholder of record entitled to vote
at such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail, addressed to the shareholder at his address
as it appears on the record of the shareholders of the Corporation, with postage
thereon prepaid.

         In the case of a special meeting, the notice of meeting shall
specifically state the purpose or purposes for which the meeting is called. In
the case of an annual or substitute annual meeting, the notice of meeting need
not specifically state the business to be transacted unless such a statement is
required by the Act.

         When an annual or special meeting is adjourned to a different date,
time, and place, it is not necessary to give any notice of the adjourned meeting
other than by announcement at the meeting at which the adjournment is taken;
provided, however, that if a new record date for the



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adjourned meeting is or must be set, notice of the adjourned meeting must be
given to persons who are shareholders as of the new record date.

         The record date for determining the shareholders entitled to notice of
and to vote at an annual or special meeting shall be fixed as provided in
Section 3 of Article VIII.

         SECTION 6. WAIVER OF NOTICE: A shareholder may waive notice of any
meeting either before or after such meeting. Such waiver shall be in writing,
signed by the shareholder, and filed with the minutes or corporate records. A
shareholder's attendance at a meeting: (i) waives objection to lack of notice or
defective notice of the meeting, unless the shareholder at the beginning of the
meeting objects to holding the meeting or transacting business at the meeting;
and (ii) waives objection to consideration of a particular matter at the meeting
that is not within the purpose or purposes described in the meeting notice,
unless the shareholder objects to considering the matter before it is voted
upon.

         SECTION 7. SHAREHOLDER LIST: Commencing two (2) business days after
notice of a meeting of shareholders is given and continuing through such
meeting, the secretary of the Corporation shall maintain at the principal office
of the Corporation an alphabetical list of the shareholders entitled to vote at
such meeting, arranged by voting group, with the address of and number of shares
held by each. This list shall be subject to inspection by any shareholder or his
agent or attorney at any time during usual business hours and may be copied at
the shareholder's expense. This list shall be made available at the meeting and
any shareholder, or his representative, may inspect the list at any time during
the meeting or any adjournment thereof.

         SECTION 8. QUORUM: A majority of the votes entitled to be cast on a
matter by any voting group, represented in person or by proxy, shall constitute
a quorum of that voting group for action on that matter. The shareholders
present at a duly organized meeting may continue to transact business until
adjournment, notwithstanding the withdrawal of enough shareholders to leave less
than a quorum.

         In the absence of a quorum at the opening of any meeting of
shareholders, such meeting may be adjourned from time to time by a majority of
the votes voting on the motion to adjourn; and at any adjourned meeting at which
a quorum is present, any business may be transacted which might have been
transacted at the original meeting.

         SECTION 9. PROXIES: Shares may be voted either in person or by one or
more agents authorized by a written proxy executed by the shareholder or by his
duly authorized attorney in fact. A proxy may take the form of a telegram,
telex, facsimile or other form of wire or wireless communication which appears
to have been transmitted by a shareholder. A proxy is effective when received by
the secretary or other officer or agent authorized to tabulate votes. A proxy is
not valid after the expiration of eleven (11) months from the date of its
execution, unless the person executing it specifies therein the length of time
for which it is to continue in force or limits its use to a particular meeting,
but no proxy, whether or not designated as irrevocable, shall be valid after ten
(10) years from the date of its execution, unless renewed or extended at any
time before its expiration for not more than ten (10) years from the date of
such renewal or extension.

         SECTION 10. VOTING OF SHARES: Except as otherwise provided in the
Articles of Incorporation and the Act, each outstanding share, regardless of
class, shall be entitled to one vote on each matter submitted to a vote at a
meeting of shareholders.



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         Except for the election of directors, which is governed by the
provisions of Section 3 of Article IV, if a quorum is present, action on a
matter by a voting group is approved if the votes cast within the voting group
favoring the action exceed the votes cast against the action, unless the vote of
a greater number is required by the Act, the Articles of Incorporation, or these
bylaws.

         Shares of the Corporation are not entitled to vote if: (i) they are
owned, directly or indirectly, by the Corporation, unless they are held by it in
a fiduciary capacity; (ii) they are owned, directly or indirectly, by a second
corporation in which the Corporation owns a majority of the shares entitled to
vote for directors of the second corporation; or (iii) they are redeemable
shares and (x) notice of redemption has been given and (y) a sum sufficient to
redeem the shares has been deposited with a bank, trust company, or other
financial institution under an irrevocable obligation to pay the holders the
redemption price upon surrender of the shares.

         SECTION 11. INFORMAL ACTION BY SHAREHOLDERS: Any action which may be
taken at a meeting of the shareholders may be taken without a meeting if a
consent in writing, setting forth the action so taken, is signed by all of the
persons who would be entitled to vote upon such action at a meeting and is
delivered to the Corporation to be included in the minutes or to be kept as part
of the corporate records. Such consent shall have the same force and effect as a
unanimous vote of shareholders.

         SECTION 12. CORPORATION'S ACCEPTANCE OF VOTES: If the name signed on a
vote, consent, waiver, or proxy appointment corresponds to the name of a
shareholder, the Corporation is entitled to accept the vote, consent, waiver, or
proxy appointment and to give it effect as the act of the shareholder.

         If the name signed on a vote, consent, waiver, or proxy appointment
does not correspond to the name of its shareholder, the Corporation is
nevertheless entitled to accept the vote, consent, waiver, or proxy appointment
and to give it effect as the act of the shareholder if: (i) the shareholder is
an entity and the name signed purports to be that of an officer or agent of the
entity; (ii) the name signed purports to be that of an administrator, executor,
guardian, or conservator representing the shareholder and, if the Corporation
requests, evidence of fiduciary status acceptable to the Corporation has been
presented with respect to the vote, consent, waiver, or proxy appointment; (iii)
the name signed purports to be that of a receiver or trustee in bankruptcy of
the shareholder and, if the Corporation requests, evidence of its status
acceptable to the Corporation has been presented with respect to the vote,
consent, waiver, or proxy appointment; (iv) the name signed purports to be that
of a beneficial owner or attorney-in-fact of the shareholder and, if the
Corporation requests, evidence acceptable to the Corporation of the signatory's
authority to sign for the shareholder has been presented with respect to the
vote, consent, waiver, or proxy appointment; or (v) two or more persons are the
shareholder as co-tenants or fiduciaries and the name signed purports to be the
name of at least one of the co-owners and the person signing appears to be
acting on behalf of all the co-owners.

         The Corporation is entitled to reject a vote, consent, waiver, or proxy
appointment if the secretary or other officer or agent authorized to tabulate
votes has a reasonable basis for doubt about the validity of the signature on it
or about the signatory's authority to sign for the shareholder.



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         SECTION 13. NOTICE OF SHAREHOLDER BUSINESS AND NOMINATIONS:

         (a)      Annual Meetings of Shareholders.

                  (i) Nominations of persons for election to the board of
directors of the Corporation and the proposal of business to be considered by
the shareholders may be made at an annual meeting of shareholders: (a) pursuant
to the notice of meeting pursuant to Article III, Section 5 of these bylaws; (b)
by or at the direction of the board of directors; or (c) by any shareholder of
the Corporation who was a shareholder of record at the time of giving of notice
provided for in this bylaw (Article III, Section 13), who is entitled to vote at
the meeting and who complies with the notice procedures set forth in this bylaw.

                  (ii) For nominations or other business to be properly brought
before an annual meeting by a shareholder pursuant to clause (c) of paragraph
(a)(i) of this bylaw, the shareholder must have given timely notice thereof in
writing to the secretary of the Corporation and such other business must
otherwise be a proper matter for shareholder action. To be timely, a
shareholder's notice shall be delivered to the secretary at the principal
executive offices of the Corporation not later than the close of business on the
60th calendar day nor earlier than the close of business on the 90th calendar
day prior to the first anniversary of the preceding year's annual meeting;
provided, however, that in the event that the date of the annual meeting is more
than thirty (30) calendar days before or more than sixty (60) calendar days
after such anniversary date, notice by the shareholder to be timely must be so
delivered not earlier than the close of business on the 90th calendar day prior
to such annual meeting and not later than the close of business on the later of
the 60th calendar day prior to such annual meeting or the 10th calendar day
following the calendar day on which public announcement of the date of such
meeting is first made by the Corporation. In no event shall the public
announcement of an adjournment of an annual meeting commence a new time period
for the giving of a shareholder's notice as described above. Such shareholder's
notice shall set forth: (a) as to each person whom the shareholder proposes to
nominate for election or reelection as a director all information relating to
such person that is required to be disclosed in solicitations of proxies for
election of directors in an election contest, or is otherwise required, in each
case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as
amended (the "Exchange Act") and Rule 14a-11 thereunder (including such person's
written consent to being named in the proxy statement as a nominee and to
serving as a director if elected); (b) as to any other business that the
shareholder proposes to bring before the meeting, a brief description of the
business desired to be brought before the meeting, the reasons for conducting
such business at the meeting and any material interest in such business of such
shareholder and the beneficial owner, if any, on whose behalf the proposal is
made; and (c) as to the shareholder giving the notice and the beneficial owner,
if any, on whose behalf the nomination or proposal is made, the name and address
of such shareholder, as they appear on the Corporation's books, and of such
beneficial owner and the class and number of shares of the Corporation which are
owned beneficially and of record by such shareholder and such beneficial owner.

         (b)      Special Meetings of Shareholders.

                  (i) Only such business shall be conducted at a special meeting
of shareholders as shall have been brought before the meeting pursuant to the
notice of meeting under Article III, Section 5 of these bylaws. If directors are
to be elected at a special meeting of



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shareholders pursuant to the notice of meeting, nominations of persons for
election to the board of directors at such meeting may be made (a) by or at the
direction of the board of directors, or (b) by any shareholder of the
Corporation who is a shareholder of record at the time of giving of notice
provided for in this bylaw, who shall be entitled to vote at the meeting and who
complies with the notice procedures set forth in this bylaw.

                  (ii) In the event a special meeting of shareholders is called
for the purpose of electing one or more directors to the board of directors, any
shareholder may, pursuant to clause (b)(i) above, nominate a person or persons
(as the case may be) for election to such position(s) as specified in the notice
of meeting, if the shareholder shall have delivered notice containing the
information specified in paragraph (a)(ii) of this bylaw to the secretary at the
principal executive offices of the Corporation not earlier than the close of
business on the 90th calendar day prior to such special meeting and not later
than the close of business on the later of the 60th calendar day prior to such
special meeting or the 10th calendar day following the day on which public
announcement is first made or the date of the special meeting and of the
nominees proposed by the board of directors to be elected at such meeting. In no
event shall the public announcement of an adjournment of a special meeting
commence a new time period for the giving of a shareholder's notice as described
above.

         (c)      General.

                  (i) Only such persons who are nominated in accordance with the
procedures set forth in this bylaw shall be eligible to serve as directors and
only such business shall be conducted at a meeting of shareholders as shall have
been brought before the meeting in accordance with the procedures set forth in
this bylaw. Except as otherwise provided by law, the Articles of Incorporation
or these bylaws, the chairman of the meeting shall have the power and duty to
determine whether a nomination or any business proposed to be brought before the
meeting was made or proposed, as the case may be, in accordance with the
procedures set forth in this bylaw and, if any proposed nomination or business
is not in compliance with this bylaw, to declare that such defective proposal or
nomination shall be disregarded.

                  (ii) For purposes of this bylaw, "public announcement" shall
mean disclosure in a press release reported in a national news service or in a
document publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

                  (iii) Notwithstanding the foregoing provisions of this bylaw,
a shareholder shall also comply with all applicable requirements of the Exchange
Act and the rules and regulations thereunder with respect to the matters set
forth in this bylaw. Nothing in this bylaw shall be deemed to affect any rights
of shareholders to request inclusion of proposals in the Corporation's proxy
statement pursuant to Rule 14a-8 under the Exchange Act.


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                                   ARTICLE IV

                               BOARD OF DIRECTORS

         SECTION 1. GENERAL POWERS: All corporate powers shall be exercised by
or under the authority of, and the business and affairs of the Corporation shall
be managed under the direction of, its board of directors.

         SECTION 2. NUMBER, TERM AND QUALIFICATIONS: The number constituting the
board of directors shall be not less than three (3); the exact number of which
shall be determined from time to time by resolution of the shareholders. Each
director shall hold office until his death, resignation, retirement, removal,
disqualification, or until his successor is elected and qualified. Directors
need not be residents of the State of North Carolina or shareholders of the
Corporation.

         SECTION 3. ELECTION OF DIRECTORS: Except as provided in Section 6 of
this Article, the directors shall be elected at the annual meeting of
shareholders; and those persons who receive the highest number of votes shall be
deemed to have been elected. If any shareholder so demands, the election of
directors shall be by ballot.

         SECTION 4. NO CUMULATIVE VOTING: Unless otherwise required by the Act,
the shareholders of the Corporation shall have no right to cumulate their votes
for the election of directors.

         SECTION 5. REMOVAL: Any director may be removed from office with or
without cause by a vote of shareholders holding a majority of the outstanding
shares entitled to vote at an election of directors. If a director is elected by
a voting group of shareholders, only members of that voting group may
participate in the vote to remove him. A director may not be removed by the
shareholders at a meeting unless the notice of the meeting specifies such
removal as one of its purposes. If any directors are removed, new directors may
be elected at the same meeting.

         SECTION 6. VACANCIES: Any vacancy occurring in the board of directors,
including, without limitation, a vacancy resulting from an increase in the
authorized number of directors or from the failure by the shareholders to elect
the full authorized number of directors, may be filled by the majority of the
remaining directors. If the directors remaining in office constitute fewer than
a quorum of the board, such vacancy may be filled by the affirmative vote of a
majority of the remaining directors or by the sole remaining director. If the
vacant office was held by a director elected by a voting group of shareholders,
the remaining director or directors elected by that voting group are entitled to
fill the vacancy. The shareholders may elect a director at any time, subject to
the provisions of Section 13 of Article III, to fill a vacancy not filled by the
directors. If the vacant office was held by a director elected by a voting group
of shareholders, the holders of shares of that voting group may fill the vacancy
not filled by the directors elected by such voting group. The term of a director
elected to fill a vacancy shall expire at the next shareholders' meeting at
which directors are elected.

         SECTION 7. CHAIRMAN OF THE BOARD: There may be a chairman of the board
of directors elected by the directors from their number at any meeting of the
board. The chairman shall serve as an officer of the Corporation as provided in
Article VI. The chairman shall preside at all meetings of the board of directors
and perform such other duties as may be directed by the board.



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         SECTION 8. COMPENSATION: The board of directors may compensate
directors for their services as such and may provide for the payment of all
expenses incurred by directors in attending regular and special meetings of the
board.

         SECTION 9. COMMITTEES: The board of directors may create an executive
committee and other committees of the board, each of which shall have at least
two (2) members, all of whom shall be directors. The creation of a committee and
the appointment of members to it must be approved by a majority of all the
directors in office when the action is taken. Each committee may, as specified
by the board of directors, exercise some or all of the authority of the board
except that a committee may not: (i) authorize distributions; (ii) approve or
propose to shareholders action that the Act requires be approved by
shareholders; (iii) fill vacancies on the board of directors or on any of its
committees; (iv) amend the Articles of Incorporation pursuant to Section
55-10-02 of the Act or its successor; (v) adopt, amend, or repeal bylaws; (vi)
approve a plan of merger not requiring shareholder approval; (vii) authorize or
approve a reacquisition of shares, except according to a formula or method
prescribed by the board of directors; or (viii) authorize or approve the
issuance or sale or contract for sale of shares, or determine the designation
and relative rights, preferences, and limitations of a class or series of
shares, except that the board of directors may authorize a committee to do so
within limits specifically prescribed by the board of directors. Any such
committee, or any member thereof, may be discharged or removed by action of the
majority of the board of directors. Any resolutions adopted or other action
taken by any such committee within the scope of the authority delegated to it by
the board of directors shall be deemed for all purposes to be adopted or taken
by the board of directors. The provisions of Article V, which govern meetings of
the board of directors, shall likewise apply to meetings of any committee of the
board.

                                    ARTICLE V

                              MEETINGS OF DIRECTORS

         SECTION 1. REGULAR MEETINGS: Regular meetings of the board of directors
shall be held at such time and place, within or without the State of North
Carolina, as the board of directors shall fix by resolution.

         SECTION 2. SPECIAL MEETINGS: Special meetings of the board of directors
may be called by or at the request of the chairman of the board, president or
any two directors. Such meetings may be held either within or without the State
of North Carolina, as fixed by the person or persons calling the meeting.

         SECTION 3. NOTICE OF MEETINGS: Regular meetings of the board of
directors may be held without notice. The person or persons calling a special
meeting of the board of directors shall, at least two (2) days before the
meeting, give notice of the meeting by any usual means of communication,
including by telephone, telegraph, teletype, mail, private carrier, facsimile
transmission, or other form of wire or wireless communication. Such notice shall
specify the purpose for which the meeting is called and may be oral.

         SECTION 4. WAIVER OF NOTICE: Any director may waive notice of any
meeting either before or after such meeting. Such waiver shall be in writing,
signed by the director, and filed with the minutes or corporate records;
provided, however, that a director's attendance at or



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participation in a meeting waives any required notice to him unless the director
at the beginning of the meeting (or promptly upon his arrival) objects to
holding the meeting or transacting business at the meeting and does not
thereafter vote for or assent to action taken at the meeting.

         SECTION 5. QUORUM: A majority of the directors in office shall
constitute a quorum for the transaction of business at any meeting of the board
of directors.

         SECTION 6. MANNER OF ACTING: The act of a majority of the directors
present at a meeting at which a quorum is present shall be the act of the board
of directors, unless a greater number is required by law, the Articles of
Incorporation or these bylaws.

         SECTION 7. PRESUMPTION OF ASSENT: A director of the Corporation who is
present at a meeting of the board of directors or a committee of the board of
directors when corporate action is taken is deemed to have assented to the
action taken unless: (i) he objects at the beginning of the meeting (or promptly
upon his arrival) to holding it or transacting business at the meeting; (ii) his
dissent or abstention from the action taken is entered in the minutes of the
meeting; or (iii) he files written notice of his dissent or abstention with the
presiding officer of the meeting before its adjournment or with the Corporation
immediately after adjournment of the meeting. This right of dissent or
abstention is not available to a director who votes in favor of the action
taken.

         SECTION 8. PARTICIPATION IN MEETINGS: Any or all of the directors may
participate in a regular or special meeting by, or conduct the meeting through
the use of, any means of communication by which all directors participating may
simultaneously hear each other during the meeting.

         SECTION 9. ACTION WITHOUT MEETING: Action which may be taken at a board
of directors meeting or at a committee of the board of directors meeting may be
taken without a meeting if the action is taken by all members of the board or
committee and is evidenced by one or more written consents signed by each
director or committee member before or after such action, which describes the
action taken and is included in the minutes or filed with the corporate records.
Such action is effective when the last director or committee member signs the
consent, unless the consent specifies a different effective date.


                                   ARTICLE VI

                                    OFFICERS

         SECTION 1. OFFICERS OF THE CORPORATION: The officers of the Corporation
shall consist of a chairman, a president, secretary, treasurer, and such vice
presidents, assistant secretaries, assistant treasurers, and other officers as
may be appointed from time to time in accordance with these bylaws. The chairman
shall be chosen from among the directors. Any two or more offices may be held by
the same person, but no officer may act in more than one capacity where action
of two or more officers is required.

         SECTION 2. APPOINTMENT AND TERM: The chairman, the president and any
executive vice presidents shall be appointed by the board of directors. The
other officers of the Corporation may be appointed by the board of directors or
the chairman. A duly appointed officer may appoint



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one or more officers or assistant officers if authorized by the board of
directors. The board of directors may appoint officers at any regular meeting or
at any special meeting called for such purpose. Each officer shall hold office
until his death, resignation, retirement, removal, disqualification or until his
successor is appointed and qualifies. The appointment of an officer does not
itself create contract rights for either the officer or the Corporation.

         SECTION 3. COMPENSATION OF OFFICERS: The compensation of officers of
the Corporation shall be fixed by the board of directors. No officer shall
receive compensation for serving the Corporation in any other capacity unless
such additional compensation be authorized by the board of directors.

         SECTION 4. RESIGNATION AND REMOVAL: An officer may resign at any time
by communicating his resignation to the Corporation. A resignation is effective
when it is communicated unless it specifies in writing a later date. If a
resignation is made effective as of a later date and the Corporation accepts the
future effective date, the board of directors may fill the pending vacancy
before the effective date if the board provides that the successor does not take
office until the effective date. An officer's resignation does not affect the
Corporation's contract rights, if any, with the officer. Any officer or agent
appointed by the board of directors may be removed by the board at any time,
with or without cause, and any officer or agent appointed by the chairman or by
any other officer, pursuant to authority granted by the board, may be removed
either by the board or by the chairman, with or without cause. Such removal
shall be without prejudice to the contract rights, if any, of the person so
removed.

         SECTION 5. BONDS: The board of directors may by resolution require any
officer, agent, or employee of the Corporation to give bond to the Corporation,
with sufficient sureties, conditioned on the faithful performance of the duties
of his respective office or position, and to comply with such other conditions
as may from time to time be required by the board of directors.

         SECTION 6. CHAIRMAN: The chairman shall be the chief executive officer
of the Corporation. Subject to the direction of the board of directors, he shall
have general executive charge, management and control of the properties,
business and operations of the Corporation with all such powers as may be
reasonably incident to such responsibilities. He may sign certificates for
shares of capital stock of the Corporation and may agree upon and execute
leases, contracts, evidences of indebtedness and other obligations in the name
of the Corporation, and any deeds, mortgages, bonds or other instruments which
may be lawfully executed on behalf of the Corporation, except where required by
law to be otherwise signed or executed and except where the signing and
execution thereof shall be delegated by the board of directors to some other
officer or agent. He shall have such other powers and duties as from time to
time may be assigned to him by the board of directors.

         SECTION 7. PRESIDENT: The president shall be the chief operating
officer of the Corporation. Subject to the direction of the chairman, he shall
supervise the day-to-day operation of the Corporation, shall act in a general
executive capacity and shall assist the chairman in the administration and
operation of the Corporation's business and general supervision of its policies
and affairs. Unless the board of directors otherwise determines, the president
shall have the authority to sign certificates for shares of capital stock of the
Corporation and may agree upon and execute leases, contracts, evidences of
indebtedness and other obligations in the name of the Corporation, and any
deeds, mortgages, bonds or other instruments which may be lawfully executed on
behalf of the Corporation, except where



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required by law to be otherwise signed or executed and except where the signing
and execution thereof shall be delegated by the board of directors to some other
officer or agent. Unless the board of directors otherwise determines, the
president shall, in the absence of or because of the inability to act of the
chairman, perform all duties of the chairman and preside at all meetings of
shareholders and (should he be a director) of the board of directors. He shall
have such other powers and duties as from time to time may be assigned to him by
the board of directors or the chairman.

         SECTION 8. EXECUTIVE VICE PRESIDENTS.The executive vice presidents, in
the order of their appointment unless otherwise determined by the board of
directors, shall, in the absence or disability of the president, perform the
duties and exercise the powers of that office. In addition, they shall perform
such other duties and have such other powers as the board of directors or the
chairman shall prescribe.

         SECTION 9. VICE PRESIDENTS. The vice presidents shall perform such
duties and have such powers as the board of directors or the chairman or
president shall prescribe.

         SECTION 10. SECRETARY. The secretary shall keep accurate records of the
acts and proceedings of all meetings of shareholders, directors and committees.
He shall give all notices required by law and by these bylaws. He shall have
general charge of the corporate books and records and of the corporate seal, and
he shall affix the corporate seal to any lawfully executed instrument requiring
it. He shall have general charge of the stock transfer books of the Corporation
and shall keep, at the registered or principal office of the Corporation or at
the offices of any transfer agent designated by the Corporation, a record of
shareholders showing the name and address of each shareholder and the number and
class of the shares held by each. He shall sign such instruments as may require
his signature, and, in general, attest the signature or certify the incumbency
or signature of any other officer of the Corporation and shall perform all
duties incident to the office of secretary and such other duties as may be
assigned from time to time by the board of directors or the chairman.

         SECTION 11. TREASURER. The treasurer shall have custody of all funds
and securities belonging to the Corporation and shall receive, deposit or
disburse the same under the direction of the chairman. The treasurer shall keep
full and accurate accounts of the finances of the Corporation in books
especially provided for that purpose, which may be consolidated or combined
statements of the Corporation and one or more of its subsidiaries as
appropriate, that include a balance sheet as of the end of the fiscal year, an
income statement for that year, and a statement of cash flows for the year
unless that information appears elsewhere in the financial statements. If
financial statements are prepared for the Corporation on the basis of generally
accepted accounting principles, the annual financial statements must also be
prepared on that basis. The treasurer shall, in general, perform all duties
incident to such office and such other duties as may be assigned from time to
time by the board of directors or the chairman.

         SECTION 12. ASSISTANT SECRETARIES AND TREASURERS. The assistant
secretaries and assistant treasurers shall, in the absence or disability of the
secretary or the treasurer, perform the respective duties and exercise the
respective powers of those offices, and they shall, in general, perform such
other duties as shall be assigned to them by the board of directors or chairman,
or by the secretary or the treasurer, respectively.



                                       11
<PAGE>   12

         SECTION 13. ACTION WITH RESPECT TO SECURITIES OF OTHER CORPORATIONS.
Unless otherwise directed by the board of directors, the chairman shall have
power to vote and otherwise act on behalf of the Corporation, in person or by
proxy, at any meeting of security holders of or with respect to any action of
security holders of any other corporation in which this Corporation may hold
securities and otherwise to exercise any and all rights and powers which this
Corporation may possess by reason of its ownership of securities in such other
corporation.


                                   ARTICLE VII

                      CONTRACTS, LOANS, CHECKS AND DEPOSITS

         SECTION 1. CONTRACTS: The board of directors may authorize any officer
or agent to enter into any contract or to execute and deliver any instrument on
behalf of the Corporation, and such authority may be general or confined to
specific instances.

         SECTION 2. LOANS: No loans shall be contracted on behalf of the
Corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the board of directors. Such authority may be
general or confined to specific instances.

         SECTION 3. CHECKS AND DRAFTS: All checks, drafts or other orders for
payment of money issued in the name of the Corporation shall be signed by such
officers or agents of the Corporation and in such manner as shall from time to
time be determined by resolution of the board of directors.

         SECTION 4. DEPOSITS: All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
in such depositories as the board of directors shall direct.

                                  ARTICLE VIII

                   CERTIFICATES FOR SHARES AND THEIR TRANSFER

         SECTION 1. CERTIFICATES FOR SHARES: Shares may, but need not, be
represented by certificates. If certificates are issued, they shall be in such
form as the board of directors shall determine; provided that, at a minimum,
each certificate shall state on its face: (i) the name of the Corporation and
that it is organized under the laws of North Carolina; (ii) the name of the
person to whom issued; and (iii) the number and class of shares and the
designation of the series, if any, the certificate represents. If the
Corporation issues certificates for shares of preferred stock, the designations,
relative rights, preferences, and limitations applicable to that class, and the
variations in rights, preferences, and limitations for each series within that
class (and the authority of the board of directors to determine variations for
future series) must be summarized on the front or back of each certificate;
alternatively, each certificate may state conspicuously on its front or back
that the Corporation will furnish the shareholder this information in writing
and without charge. These certificates shall be signed, either manually or in
facsimile, by the president, any vice president or any person who has been
designated the chairman of the Corporation, and the secretary or any assistant
secretary, the treasurer or any assistant treasurer. In case any officer who has
signed or whose facsimile or other signature has been placed upon such
certificate shall



                                       12
<PAGE>   13

have ceased to be such officer before such certificate is issued, it may be
issued by the Corporation with the same effect as if he were such officer at the
date of its issue. They shall be consecutively numbered or otherwise identified
and the name and address of the persons to whom they are issued, with the number
of shares and date of issue, shall be entered on the stock transfer books of the
Corporation.

         SECTION 2. TRANSFER OF SHARES: Transfer of shares of the Corporation
shall be made only on the stock transfer books of the Corporation by the holder
of record, by his legal representative (who shall furnish proper evidence of
authority to transfer) or by his attorney (whose authority shall be evidenced by
a power of attorney duly executed and filed with the secretary), and only upon
surrender for cancellation of the certificates for such shares. All certificates
surrendered for transfer shall be cancelled before new certificates for the
transferred shares shall be issued.

         SECTION 3. FIXING RECORD DATE: For the purpose of determining
shareholders entitled to receive notice of a meeting of shareholders, to demand
a special meeting, to vote, to take any other action, or to receive payment, or
for any other purpose, the board of directors may fix in advance a date as the
record date for any such determination of shareholders, such record date in any
case to be not more than sixty (60) days, and, in case of a meeting of
shareholders, not less than ten (10) days, before the date on which the
particular action requiring such determination of shareholders is to be taken.

         When a determination of shareholders entitled to notice of or to vote
at any meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment of such meeting unless the board of
directors fixes a new record date, which it must do if the meeting is adjourned
to a date more than 120 days after the date fixed for the original meeting.

         SECTION 4. LOST CERTIFICATES: The board of directors may authorize the
issuance of a new share certificate in place of a certificate claimed to have
been lost or destroyed, upon receipt of an affidavit of such fact from the
person claiming the loss or destruction. When authorizing the issuance of a new
certificate, the board of directors may require the claimant to give the
Corporation a bond in such sum as it may direct to indemnify the Corporation
against loss from any claim with respect to the certificate claimed to have been
lost or destroyed; or the board of directors may, by resolution reciting that
the circumstances justify such action, authorize the issuance of the new
certificate without requiring such a bond.

         SECTION 5. REACQUIRED SHARES: The Corporation may acquire its own
shares and shares so acquired constitute authorized but unissued shares.


                                   ARTICLE IX

                               GENERAL PROVISIONS

         SECTION 1. DISTRIBUTIONS: The board of directors may from time to time
declare, and the Corporation may make, distributions on its outstanding shares
in the manner and subject to the terms and conditions provided by the Act and by
the Articles of Incorporation.



                                       13
<PAGE>   14

         SECTION 2. SEAL: The corporate seal of the Corporation shall consist of
two concentric circles between which is the name of the Corporation and in the
center of which is inscribed "1987" and which shall have such other
characteristics as the board of directors may determine.

         SECTION 3. RECORDS AND REPORTS: All of the Corporation's records shall
be maintained in written form or in another form capable of conversion into
written form within a reasonable time.

         The Corporation shall keep as permanent records minutes of all meetings
of its incorporators, shareholders, and board of directors, a record of all
actions taken by the shareholders or board of directors without a meeting, and a
record of all actions taken by a committee of the board of directors in place of
the board of directors.

         The Corporation shall keep a copy of the following records at its
principal office: (i) the Articles of Incorporation and all amendments to them
currently in effect; (ii) these bylaws and all amendments to them currently in
effect; (iii) resolutions adopted by its board of directors creating one or more
classes or series of shares and fixing their relative rights, preferences, and
limitations (if shares issued pursuant to those resolutions are outstanding);
(iv) the minutes of all meetings of shareholders and records of all actions
taken by shareholders without a meeting during the past three years; (v) all
written communications to shareholders generally within the past three years;
(vi) the annual financial statements described below, prepared during the past
three years; (vii) a list of the names and business addresses of its current
directors and officers; and (viii) its most recent annual report delivered to
the North Carolina Secretary of Revenue (or Secretary of State, if applicable).

         The Corporation shall prepare and make available to its shareholders
annual financial statements for the Corporation and its subsidiaries that: (i)
includes a balance sheet as of the end of the fiscal year, an income statement
for that year, and a statement of cash flows for the year; and (ii) is
accompanied by either (x) a report of a public accountant on the annual
financial statements, or (y) a statement by the treasurer stating his reasonable
belief whether the annual financial statements were prepared on the basis of
generally accepted accounting principles (and, if not, describing the basis of
preparation) and describing any respects in which the statements were not
prepared on a basis of accounting consistent with the statements prepared for
the preceding year. These annual financial statements, or a written notice of
their availability, shall be mailed to each shareholder within 120 days after
the close of each fiscal year of the Corporation. On written request from a
shareholder who was not mailed the annual financial statements, the Corporation
shall mail to him the latest such statements.

         The Corporation shall also prepare and file with the North Carolina
Secretary of Revenue (or North Carolina Secretary of State, if applicable) an
annual report in such form as required by Section 55-16-22 of the Act, or its
successor.

         SECTION 4. INDEMNIFICATION: Any person who at any time serves or has
served as a director or officer of the Corporation, or at the request of the
Corporation is or was serving as an officer, director, agent, partner, trustee,
administrator, or employee for any other foreign or domestic corporation,
partnership, joint venture, trust, employee benefit plan, or other enterprise,
shall be indemnified by the Corporation to the fullest extent from time to time
permitted by law in the event he is made, or is threatened to be made, a party
to any threatened, pending or completed civil, criminal, administrative,
investigative or arbitrative action, suit or proceeding and



                                       14
<PAGE>   15

any appeal therein (and any inquiry or investigation that could lead to such
action, suit or proceeding), whether or not brought by or on behalf of the
Corporation, seeking to hold him liable by reason of the fact that he is or was
acting in such capacity; provided, however, that the Corporation shall not
indemnify any such person against liability or expenses he may incur on account
of his activities which were, at the time taken, known or believed by him to be
clearly in conflict with the best interests of the Corporation. In addition, the
board may provide such indemnification for the employees and agents of the
Corporation as it deems appropriate.

         The rights of those receiving indemnification hereunder shall, to the
fullest extent from time to time permitted by law, cover (i) reasonable
expenses, including without limitation all attorneys' fees actually and
necessarily incurred by him in connection with any such action, suit or
proceeding, (ii) all reasonable payments made by him in satisfaction of any
judgment, money decree, fine (including an excise tax assessed with respect to
an employee benefit plan), penalty, or settlement for which he may have become
liable in such action, suit or proceeding; and (iii) all reasonable expenses
incurred in enforcing the indemnification rights provided herein.

         Expenses incurred by anyone entitled to receive indemnification under
this section in defending a proceeding may be paid by the Corporation in advance
of the final disposition of such proceeding as authorized by the board of
directors in the specific case or as authorized or required under any provisions
in the bylaws or by any applicable resolution or contract upon receipt of an
undertaking by or on behalf of the director to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by the
Corporation against such expenses.

         The board of directors of the Corporation shall take all such action as
may be necessary and appropriate to authorize the Corporation to pay the
indemnification required by this bylaw, including without limitation, to the
extent needed, making a good faith evaluation of the manner in which the
claimant for indemnity acted and of the reasonable amount of indemnity due him.

         Any person who at any time serves or has served in any of the aforesaid
capacities for or on behalf of the Corporation shall be deemed to be doing or to
have done so in reliance upon, and as consideration for, the right of
indemnification provided herein. Any repeal or modification of these
indemnification provisions shall not affect any rights or obligations existing
at the time of such repeal or modification. The rights provided for herein shall
inure to the benefit of the legal representatives of any such person and shall
not be exclusive of any other rights to which such person may be entitled apart
from the provisions of this bylaw.

         The Corporation shall have the power to purchase and maintain insurance
on behalf of any person who 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, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise or as a trustee or administrator under an
employee benefit plan against any liability asserted against him and incurred by
him in such capacity, or arising out of his status as such, whether or not the
Corporation or other such enterprise would have the power to indemnify him
against such liability.

         The rights granted herein shall not be limited by the provisions
contained in Section 55-8-51 of the Act (or its successor).



                                       15
<PAGE>   16

         SECTION 5. FISCAL YEAR: The fiscal year of the Corporation shall be
fixed by the board of directors.

         SECTION 6. AMENDMENTS:

                  (a) The board of directors may amend or repeal these bylaws,
except to the extent otherwise provided in the Articles of Incorporation, a
bylaw adopted by the shareholders, or the Act, and except that a bylaw adopted,
amended or repealed by the shareholders may be readopted, amended or repealed by
the board of directors if the Articles of Incorporation, the Act or a bylaw
adopted by the shareholders authorizes the board of directors to adopt, amend,
or repeal that particular bylaw or the bylaws generally.

                  (b) The board of directors shall have no power to adopt a
bylaw:

                           (1)      Changing the statutory requirement for a
                                    quorum of directors or action by directors
                                    or changing the statutory requirement for a
                                    quorum of shareholders or action by
                                    shareholders;

                           (2)      Providing for the management of the
                                    Corporation otherwise than by the board of
                                    directors or the committees thereof;

                           (3)      Increasing or decreasing the number of
                                    directors; or

                           (4)      Classifying and staggering the election of
                                    directors.

                  (c) The Corporation's shareholders may adopt, amend, alter,
change, or repeal any of these bylaws consistent with the provisions of Section
10 of Article III.

         SECTION 7. EMERGENCIES: In anticipation of or during an emergency, the
board of directors may: (i) modify lines of succession to accommodate the
incapacity of any director, officer, employee, or agent; and (ii) relocate the
principal office or designate alternative principal or regional offices, or
authorize the officers to do so.

         During an emergency: (i) notice of a meeting of the board of directors
need be given only to those directors whom it is practicable to reach and may be
given in any practicable manner, including by publication and radio; and (ii)
one or more officers present at a meeting of the board of directors may be
deemed to be directors for the meeting, in order of rank and within the same
rank in order of seniority, as necessary to achieve a quorum.

         SECTION 8. SEVERABILITY: Should any provision of these bylaws become
ineffective or be declared to be invalid for any reason, such provision shall be
severable from the remainder of these bylaws and all other provisions of these
bylaws shall continue to be in full force and effect.

         SECTION 9. WAIVER OF NOTICE: Whenever any notice is required to be
given to any shareholder or director under the provisions of the Act or under
the provisions of the Articles of Incorporation or bylaws of the Corporation, a
waiver thereof in writing signed by the person or persons entitled to such
notice, whether before or after the time stated therein, shall be equivalent to
the giving of such notice.



                                       16
<PAGE>   17

         SECTION 10. TIME PERIODS: In applying any provision of these bylaws
which requires an act to be done or not done a specified number of days prior to
an event or that an act be done during a period of a specified number of days
prior to an event, calendar days shall be used, the day of the doing of the act
shall be excluded and the day of the event shall be included.


ATTESTED:



      /s/ Adam H. Broome                      Date:       November 1, 1999
-------------------------------------              ---------------------------
               Secretary



                                       17