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                                                                  EXHIBIT 3(ii)

                               SCHMITT INDUSTRIES, INC.

                                SECOND RESTATED BYLAWS


                                      SECTION 1

                       SHAREHOLDERS AND SHAREHOLDERS' MEETINGS

     1.1  ANNUAL MEETING.  The annual meeting of the shareholders of this
corporation (the "Corporation") for the election of directors and for the
transaction of such other business as may properly come before the meeting shall
be held once in each calendar year (not being more than 13 months after the
holding of the last preceding annual meeting) at the principal office of the
Corporation, or at some other place, all as determined by the Board of
Directors.

     1.2  SPECIAL MEETINGS.  Special meetings of the shareholders for any
purpose or purposes may be called at any time by the President or Board of
Directors.  Further, a special meeting of the shareholders shall be held if the
holders of not less than 25% of all votes entitled to be cast on the issue
proposed to be considered at such special meeting have dated, signed and
delivered to the Secretary one or more written demands for such meeting,
describing the purpose or purposes for which it is to be held.  The meetings
shall be held at such time and place as the Board of Directors prescribe, or, if
not held upon the request of the Board of Directors, at such time and place may
be established by the President or by the Secretary in the President's absence.

     1.3  NOTICE OF MEETINGS.  Written notice of the place, date and time of the
annual shareholders' meeting and written notice of the place, date, time and
purpose or purposes of special shareholders' meetings shall be delivered not
less than 10 or more than 60 days before the date of meeting, either personally,
by facsimile, or by mail, or in any other manner approved by law, by or at the
direction of the President or the Secretary, to each shareholder of record
entitled to notice of such meeting.  Mailed notices shall be deemed to be
delivered when deposited in the mail, first-class postage prepaid, correctly
addressed to the shareholder's address shown in the Corporation's current record
of shareholders.  Notice given in any other manner shall be deemed effective
when dispatched to the shareholder's address, telephone number or other number
appearing on the records of the Corporation.

     1.4  WAIVER OF NOTICE.  Except where expressly prohibited by law or the
Articles of Incorporation, notice of the place, date, time and purpose or
purposes of any shareholders' meeting may be waived in a signed writing
delivered to the Corporation by any shareholder at any time, either before or
after the meeting.  Attendance at the meeting in person or by proxy 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.  A shareholder waives objection to
consideration of a particular matter at a meeting that is not within the purpose
or purposes described in the meeting notice, unless the shareholder objects to
considering the matter when it is presented.


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     1.5  SHAREHOLDERS' ACTION WITHOUT A MEETING.  The shareholders may take any
action without a meeting that they could properly take at a meeting, if one or
more written consents setting forth the action so taken are signed by all of the
shareholders entitled to vote with respect to the subject matter and are
delivered to the Corporation for inclusion in the minutes or filing with the
corporate records.  Actions taken under this section are effective when all
consents are in the possession of the Corporation, unless otherwise specified in
the consent.  A shareholder may withdraw consent only by delivering  a written
notice of withdrawal to the Corporation prior to the time that all consents are
in the possession of the Corporation.

     1.6  TELEPHONE MEETINGS.  Shareholders may participate in a meeting of
shareholders by means of a conference telephone or any similar communication
equipment that enables all persons participating in the meeting to hear each
other during the meeting.  Participation by such means shall constitute presence
in person at a meeting.

     1.7  LIST OF SHAREHOLDERS.  At least 10 days before any shareholders'
meeting, the Secretary of the Corporation or the agent having charge of the
stock transfer books of the Corporation shall have prepared an alphabetical list
of the names of the shareholders on the record date who are entitled to notice
of a shareholders' meeting, arranged by voting group, and within each voting
group, by class or series of shares, and showing the address of and number of
shares held by each shareholder.

     1.8  QUORUM AND VOTING.  The presence in person or by proxy of the holders
of a majority of the votes entitled to be cast on a matter at a general or
special meeting shall constitute a quorum of shareholders for that matter.  If a
quorum exists, action on a matter shall be approved by a voting group if the
votes case within a voting group favoring the action exceed the votes cast
within the voting group opposing the action, unless a greater number of
affirmative votes is required by the Articles of Incorporation or by law.  If
the Articles of Incorporation or Oregon law provide for voting by two or more
voting groups on a matter, action on a matter is taken only when voted upon by
each of those voting group counted separately.  Action may be taken by one
voting group on a matter even though no action is taken by another voting group.

     1.9  ADJOURNED MEETINGS.  If a shareholders' meeting is adjourned to a
different place, date or time, whether for failure to achieve a quorum or
otherwise, notice need not be given of the new place, date or time if the new
place, date or time is announced at the meeting before adjournment.  When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in these Bylaws, that determination shall apply to any
adjournment thereof, unless Oregon law requires fixing a new record date.  If
Oregon law requires that a new record date be set for the adjourned meeting,
notice of the adjourned meeting must be given to shareholders as of the new
record date.  Any business may be transacted at an adjourned meeting that could
have been transacted at the meeting as originally called.

     1.10 PROXIES.  A shareholder may appoint a proxy to vote or otherwise act
for the shareholder by signing an appointment form, either personally or by an
agent.  No 


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appointment shall be valid after 11 months from the date of its execution 
unless the appointment form expressly so provides.  An appointment of a proxy 
is revocable unless the appointment is coupled with an interest.  No 
revocation shall be effective until written notice thereof has actually been 
received by the Secretary of the Corporation or any other officer or agent 
authorized to tabulate votes.

     1.11 BUSINESS FOR SHAREHOLDERS' MEETINGS.

          1.11.1    BUSINESS AT ANNUAL MEETINGS.

                    (a)  In addition to the election of directors, other proper
business may be transacted at an annual meeting of shareholders, provided that
such business is properly brought before such meeting.  To be properly brought
before an annual meeting business must be (i) brought by or at the direction of
the Board or (ii) brought before the meeting by a shareholder by inclusion in
the Corporation's proxy statement pursuant to the provisions of Rule 14a-8 under
Section 14 of the Securities Exchange Act of 1934, as amended, or any successor
provision, when and if such Rule is applicable thereto, or if such business is
not so included in the Corporation's proxy statement, only pursuant to written
notice thereof in accordance with subsection 1.12 hereof, and received by the
Secretary not fewer than 60 nor more than 90 days prior to the date of such
annual meeting (or, if less than 60 days' notice or prior public disclosure of
the date of the annual meeting is given or made to the shareholders, not later
than the close of business on the tenth business day following the day on which
such notice of the date of the annual meeting was mailed or such public
disclosure was made, whichever first occurs).

                    (b)  Any such shareholder notice shall set forth (i) the 
name and address of the shareholder proposing such business; (ii) a 
representation that the shareholder is entitled to vote at such meeting; 
(iii) a statement of the number of shares of the Corporation which are 
beneficially owned by the shareholder and the date upon which such shares 
were acquired; (iv) a representation that the shareholder intends to appear 
in person or by proxy at the meeting to propose such business; and (v) as to 
each matter 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, the language of the 
proposal (if appropriate), and any material interest of the shareholder in 
such business.

                    (c)  No business shall be conducted at any annual meeting 
of shareholders except in accordance with this subsection 1.11.1.  If the 
facts warrant, the Board, or the chairman of an annual meeting of 
shareholders, may determine and declare that (i) a proposal does not 
constitute proper business to be transacted at the meeting or (ii) the 
business was not properly brought before the meeting in accordance with the 
provisions of this subsection 1.11.1 and, if, in either case, it is so 
determined, any such business shall not be transacted.

          1.11.2    BUSINESS AT SPECIAL MEETINGS.  At any special meeting of the
shareholders, only business within the purpose or purposes described in the
meeting notice required by Section 1.3 may be conducted.


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     1.12 NOTICE TO CORPORATION.  Any written notice required to be delivered by
a shareholder to the Corporation pursuant to Section 1.2 or Section 1.11 hereof
must be given, either by personal delivery or by registered or certified mail,
postage prepaid, to the Secretary at the Corporation's principal office.

                                      SECTION 2

                                  BOARD OF DIRECTORS

     2.1  NUMBER AND QUALIFICATION.  The business affairs and property of the
Corporation shall be managed under the direction of a Board of Directors, the
number of members of which shall be no fewer than two nor more than nine, as
established from time to time by the Board of Directors.  The Board of Directors
may increase or decrease this number or this range by resolution.  A member of
the Board of Directors does not need to be a shareholder of the Corporation.

     2.2  ELECTION--TERMS OF OFFICE.

          2.2.1     The directors shall be elected by the shareholders at each
annual shareholders' meeting or at a special shareholders' meeting called for
such purpose.

          2.2.2     The Board of Directors shall be divided into three classes
if the authorized number of directors is four or more, with said classes to be
as equal in number as may be possible.  Any director or directors in excess of
the number divisible by three shall be first assigned to Class 1 and any
additional director shall be assigned to Class 2, as the case may be.  (For
example, if there are five directors, the fourth director shall be in Class 1
and the fifth director in Class 2.)  At the first election of directors to such
classified Board of Directors, each Class 1 Director shall be elected to serve
until the next ensuing annual meeting of shareholders, each Class 2 Director
shall be elected to serve until the second ensuing annual meeting of
shareholders and each Class 3 Director, shall be elected to serve until the
third ensuing annual meeting of shareholders.  At each annual meeting of
shareholders following the meeting at which the Board of Directors is initially
classified, the number of directors equal to the number of directors in the
class whose term expires at the time of such meeting shall be elected to serve
until the third ensuing annual meeting. Notwithstanding any of the foregoing
provisions of this Section 2, directors shall serve until their successors are
elected and qualified or until their earlier death,  resignation or removal from
office, or until there is a decrease in the number of directors; provided,
however, that no decrease in the number of directors shall have the effect of
shortening the term of any incumbent director.

          2.2.3     The term of office of a director shall commence effective
immediately upon election, unless otherwise specified in a resolution approved
by the shareholders in connection with the election of such director.  Directors
shall serve until their successors are elected and qualified or until their
earlier death, resignation or removal from office, or until there is a decrease
in the authorized number of directors; provided, however, that no decrease in
the number of directors shall have the effect of shortening the term of any
incumbent 


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director.

     2.3  NOMINATIONS.

          2.3.1     Only persons who are nominated in accordance with the
following procedures shall be eligible for election as directors.  Nominations
for the election of directors may be made (a) by or at the direction of the
Board or (b) by any shareholder of record entitled to vote for the election of
directors at such meeting; provided, however, that a shareholder may nominate
persons for election as directors only if written notice (in accordance with
Section 1.12 hereof) of such shareholder's intention to make such nominations is
received by the Secretary not later than (i) with respect to an election to be
held at an annual meeting of the shareholders, not fewer than 60 nor more than
90 days prior to the date of such annual meeting (or, if less than 60 days'
notice or prior public disclosure of the date of the annual meeting is given or
made to the shareholders, not later than the close of business on the tenth
business day following the day on which such notice of the date of the annual
meeting was mailed or such public disclosure was made, whichever first occurs)
and (ii) with respect to an election  to be held at a special meeting of the
shareholders for the election of directors, the close of business on the tenth
business day following the date on which notice of such meeting is first mailed
to shareholders.

          2.3.2     Any such shareholder's notice shall set forth (a) the name
and address of the shareholder who intends to make a nomination; (b) a
representation that the shareholder is entitled to vote at such meeting; (c) a
statement of the number of shares of the Corporation which are beneficially
owned by the shareholder and the dates upon which such shares were acquired;
(d) a representation that the shareholder intends to appear in person or by
proxy at the meeting to nominate the person or persons specified in the notice;
(e) as to each person the shareholder proposes to nominate for election or
reelection as a director, the name and address of such person and such other
information regarding such nominee as would be required in a proxy statement
filed pursuant to the proxy rules of the Securities and Exchange Commission had
such nominee been nominated by the Board, and a description of any arrangements
or understandings between the shareholder and such nominee and any other persons
(including their names) pursuant to which the nomination is to be made; and
(f) the consent of each such nominee to serve as a director if elected.

          2.3.3     If the facts warrant, the Board, or the chairman of a
shareholders' meeting at which directors are to be elected, shall determine and
declare that a nomination was not made in accordance with the foregoing
procedure and, if it is so determined, the defective nomination shall be
disregarded.  The right of shareholders to make nominations pursuant to the
foregoing procedure is subject to the rights of the holders of any class or
series of stock having a preference over the Common Stock as to dividends or
upon liquidation.  The procedures set forth in this Section 2.3 for nomination
for the election of directors by shareholders are in addition to, and not in
limitation of, any procedures now in effect or hereafter adopted by or at the
direction of the Board or any committee thereof.


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     2.4  REMOVAL.

          2.4.1     Any director or the entire Board may be removed for cause by
the holders of not less than two-thirds of the shares entitled to elect the
director or directors whose removal is sought.  Such action may only be taken at
a special meeting of the shareholders called expressly for that purpose,
provided that notice of the proposed removal, which shall include a statement of
the charges alleged against the director, shall have been duly given to the
shareholders together with or as a part of the notice of the meeting.

          2.4.2     The vacancy created by the removal of a director under this
Section 2.4. shall be filled only by a vote of the holders of two-thirds of the
shares then entitled to elect the director removed.  Such vote may be taken at
the same meeting at which the removal of such director was accomplished, or at
such later meeting, annual or special, as the shareholders may decide.

     2.5  VACANCIES.  Subject to the provisions of Section 2.4 hereof and unless
the Second Restated Articles of Incorporation provide otherwise, vacancies in
the Board of Directors, whether caused by resignation, death, retirement,
disqualification, increase in the number of directors, removal or otherwise, may
be filled for the remainder of the term by the Board of Directors only or, if
the directors in office constitute less than a quorum of the Board of Directors,
by an affirmative vote of a majority of the remaining directors, unless there
are no directors remaining in which case the vacancies shall be filled by the
shareholders.  The term of a director elected to fill a vacancy expires at the
next annual shareholders' meeting.  A vacancy that will occur at a specific
later date may be filled before the vacancy occurs, but the new director may not
take office until the vacancy occurs.

     2.6  QUORUM AND VOTING.  At any meeting of the Board of Directors, the
presence in person (including presence by electronic means such as a telephone
conference call) of 50% of the number of directors presently in office shall
constitute a quorum for the transaction of business.  Notwithstanding the
foregoing, in no case shall a quorum be less than one-third of the authorized
number of directors.  If a quorum  is present at the time of a vote, the
affirmative vote of a majority of the directors present at the time of the vote
shall be the act of the Board of Directors and of the Corporation except as may
be otherwise specifically provided by the Articles of Incorporation, by these
Bylaws, or by law.  A director who is present at a meeting of the Board of
Directors when action is taken is deemed to have assented to the action taken
unless: (a) the director objects at the beginning of the meeting, or promptly
upon his or her arrival, to holding it or to transacting business at the
meeting; (b) the director's dissent or abstention from the action taken is
entered in the minutes of the meeting; or (c) the director delivers written
notice of his or her dissent or abstention to the presiding officer of the
meeting before its adjournment or to the Corporation within a reasonable time
after adjournment of the meeting.  The right of dissent or abstention is not
available to a director who votes in favor of the action taken.

     2.7  REGULAR MEETINGS.  Regular meetings of the Board of Directors shall be
held at such place, date and time as shall from time to time be fixed by
resolution of the Board.


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     2.8  SPECIAL MEETINGS.  Special Meetings of the Board of Directors may be
held at any place and at any time and may be called by the Chairman of the
Board, if there is one, the President or any two or more directors.

     2.9  NOTICE OF MEETING.

          2.9.1     Unless the Articles of Incorporation provide otherwise, any
regular meeting of the Board of Directors may be held without notice of the
date, time, place, or purpose of the meeting.  Any special meeting of the Board
of Directors must be preceded by at least two days' notice of the date, time,
and place of the meeting, but not of its purpose, unless the Articles of
Incorporation or these Bylaws require otherwise.  Each director shall have a
mailing address, telephone number and facsimile number on record with the
Corporation for purposes of receiving notice.

          2.9.2     Notice may be given personally, by facsimile, by mail, or in
any other manner allowed by law.  Oral notice shall be sufficient only if a
written record of such notice is included in the Corporation's minute book. 
Notice shall be deemed effective at the earliest of: (a) receipt; (b) delivery
to the proper address or telephone number of the director as shown in the
Corporation's records: or (c) three days after its deposit in the United States
mail, as evidenced by the postmark, if correctly addressed and mailed with
first-class postage prepaid.

          2.9.3     Notice of any meeting of the Board of Directors may be
waived by any director at any time, by a signed writing, delivered to the
Corporation for inclusion in the minutes, either before or after the meeting. 
Attendance or participation by a director at a meeting shall constitute a waiver
of any required  notice of meeting unless the director promptly objects to
holding the meeting or to the transaction of any business on the grounds that
the meeting was not lawfully convened and the director does not thereafter vote
for or assent to action taken at the meeting.

     2.10 DIRECTORS' ACTION WITHOUT A MEETING.  The Board of Directors or a
committee thereof may take any action without a meeting that it could properly
take at a meeting if one or more written consents setting forth the action are
signed by all of the directors, or all of the members of the committee, as the
case may be, either before or after the action is taken, and if the consents are
delivered to the Corporation for inclusion in the minutes or filing with the
corporate records.  Such action shall be effective upon the signing of a consent
by the last director to sign, unless the consent specifies a later effective
date.

     2.11 COMMITTEES OF THE BOARD OF DIRECTORS.  The Board of Directors, by
resolutions adopted by a majority of the members of the Board of Directors in
office, may create from among its members one or more committees and shall
appoint the members thereof.  Each such committee must have two or more members,
who shall be directors and who shall serve at the pleasure of the Board of
Directors.  Each committee of the Board of Directors may exercise the authority
of the Board of Directors to the extent provided in its enabling resolution and
any pertinent subsequent resolutions adopted in like manner, provided that the
authority of each such committee shall be subject to applicable law.  Each
committee of the Board of Directors 


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shall keep regular minutes of its proceedings and shall report to the Board 
of Directors when requested to do so.

     2.12 TELEPHONE MEETINGS.  Members of the Board of Directors or of any
committee appointed by the Board of Directors may participate in a meeting of
the Board of Directors or committee by means of a conference telephone or
similar communications equipment that enables all persons participating in the
meeting to hear each other during the meeting.  Participation by such means
shall constitute presence in person at a meeting.

     2.13 COMPENSATION OF DIRECTORS.  The Board of Directors may fix the
compensation of directors as such and may authorize the reimbursement of their
expenses.

                                       SECTION 3

                                       OFFICERS

     3.1  OFFICERS ENUMERATED--APPOINTMENT.  The officers of the Corporation
shall consist of such officers and assistant officers as may be designated by
resolution of the Board of Directors.  The officers shall include a President
and a Secretary, and may include a Chairman of the Board, one or more Vice
Presidents, a Treasurer, and any assistant officers or other officers having
such designations as shall be determined by the Board of Directors.  The
officers shall hold office at the pleasure of the Board of Directors.  Unless
otherwise restricted by the Board of Directors, the President may appoint any
assistant officer or other officers, the Secretary may appoint one or more
Assistant Secretaries, and the Treasurer may appoint one or more Assistant
Treasurers; provided that any such appointments shall be recorded in writing in
the corporate records.

     3.2  QUALIFICATIONS.  None of the officers of the Corporation needs to be a
director.  Any two or more corporate offices may be held by the same person.

     3.3  DUTIES OF THE OFFICERS.  Unless otherwise prescribed by the Board of
Directors, the duties of the officers shall be as follows:

          3.3.1     CHAIRMAN OF THE BOARD.  The Chairman of the Board, if one is
elected, shall preside at meetings of the Board of Directors and of the
shareholders, shall be responsible for carrying out the plans and directives of
the Board of Directors, shall report to and consult with the Board of Directors
and, if the Board so resolves, shall have such other powers and duties as the
Board of Directors may from time to time prescribe.

          3.3.2     PRESIDENT.  The President shall exercise the usual executive
powers pertaining to the office of President.  In the absence of a Chairman of
the Board, the President shall preside at meetings of the Board of Directors and
of the shareholders, perform the other duties of the Chairman of the Board
prescribed in this section, and perform such other duties as the Board of
Directors may from time to time designate.  In addition, if there is no
Secretary in office, the President shall perform the duties of the Secretary.


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          3.3.3     VICE PRESIDENT.  Each Vice President shall perform such
duties as the Board of Directors may from time to time designate.  In addition,
in the absence or disability of the President, the Vice President (or if there
is more than one Vice President, then in the order designated by the Board of
Directors) shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all restrictions upon the President.

          3.3.4     SECRETARY.  The Secretary shall be responsible for and shall
keep, personally or with the assistance of others, records of the proceedings of
the directors and shareholders; authenticate records of the Corporation; attest
all certificates of stock in the name of the Corporation; keep the corporate
seal, if any, and affix the same to certificates of stock and other proper
documents; keep a record of the issuance of certificates of stock and the
transfers of the same; and perform such other duties as the Board of Directors
may from time to time designate.

          3.3.5     TREASURER.  The Treasurer shall have the care and custody
of, and be responsible for, all funds and securities of the Corporation and
shall cause to be kept regular books of account.  The Treasurer shall cause to
be deposited all funds and other valuable effects in the name of the Corporation
in such depositories as may be designated by the Board of Directors.  In
general, the Treasurer shall perform all of the duties incident to the office of
Treasurer, and such other duties as from time to time may be assigned by the
Board of Directors.

          3.3.6     ASSISTANT OFFICERS.  Assistant officers may consist of one
or more Vice Presidents, one or more Assistant Secretaries, one or more
Assistant Treasurers and such other titles as may be designated from time to
time.  Each assistant officer shall perform those duties assigned to him or her
from time to time by the Board of Directors, the President, or the officer who
appointed him or her.

     3.4  VACANCIES.  Vacancies in any office arising from any cause may be
filled by the Board of Directors at any regular or special meeting.

     3.5  REMOVAL.  Any officer or agent may be removed by action of the Board
of Directors with or without cause, but any removal shall be without prejudice
to the contract rights, if any, of the person removed.  Election or appointment
of an officer or agent shall not itself create any contract rights.

     3.6  COMPENSATION.  The compensation of all officers of the Corporation
shall be fixed by the Board of Directors.


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                                      SECTION 4

                          SHARES AND CERTIFICATES OF SHARES

     4.1  SHARE CERTIFICATES.  Share certificates shall be issued in numerical
order, and each shareholder shall be entitled to a certificate signed by the
Chairman of the Board, President or a Vice President, and signed by the
Secretary or an Assistant Secretary.  Share certificates may be sealed with the
corporate seal, if any.  Facsimiles of the signatures and seal may be used as
permitted by law.  Every share certificate shall state:

               (a)  the name of the Corporation;

               (b)  that the Corporation is organized under the laws
                    of the State of Oregon;

               (c)  the name of the person to whom the share
                    certificate is issued;

               (d)  the number, class and series (if any) of shares
                    that the certificate represents; and

               (e)  if the Corporation is authorized to issue shares
                    of more than one class or series, that upon
                    written request and without charge, the
                    Corporation will furnish any shareholder with a
                    full statement of the designations, preferences,
                    limitations and relative rights of the shares of
                    each class or series, and the authority of the
                    Board of Directors to determine variations for
                    future series.

     4.2  CONSIDERATION FOR SHARES.  Shares of the Corporation may be issued for
such consideration as shall be determined by the Board of Directors to be
adequate.  The consideration for the issuance of shares may be paid in whole or
in part in cash, or in any tangible or intangible property or benefit to the
Corporation, including but not limited to promissory notes, service performed,
contracts for services to be performed, or other securities of the Corporation. 
Establishment by the Board of Directors of the amount of consideration received
or to be received for shares of the Corporation shall be deemed to be a
determination that the consideration so established is adequate.

     4.3  TRANSFERS.  Shares may be transferred by delivery of the certificate,
accompanied either by an assignment in writing on the back of the certificate,
or by a written power of attorney to sell, assign and transfer the same, signed
by the record holder of the certificate.  Except as otherwise specifically
provided in these Bylaws, no shares of stock shall be transferred on the books
of the Corporation until the outstanding certificate thereof has been
surrendered to the Corporation.


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     4.4  LOSS OR DESTRUCTION OF CERTIFICATES.  In the event of the loss or
destruction of any certificate, a new certificate may be issued in lieu thereof
upon satisfactory proof of such loss or destruction, and upon the giving of
security against loss to the Corporation by bond, indemnity or otherwise, to the
extent deemed necessary by the Board of Directors, the Secretary, or the
Treasurer.

     4.5  FIXING RECORD DATE.  The Board of Directors may fix in advance a date
as the record date for determining shareholders entitled: (a) to notice of or to
vote at any shareholders' meeting or any adjournment thereof; (b) to receive
payment of any share dividend; or (c) to receive payment of any distribution. 
The Board of Directors may in addition fix record dates with respect to any
allotment or rights of conversion or exchange of any securities by their terms,
or for any other proper purpose, as determined by the Board of Directors and by
law.  The record date shall be not more than 70 days and, in case of a meeting
of shareholders, not less than 10 days (or such longer period as may be required
by Oregon law) prior to the date on which the particular action requiring
determination of shareholders is to be taken.  If no record date is fixed for
determining the shareholders entitled to notice of or to vote at a meeting of
shareholders, the record date shall be the date before the day on which notice
of the meeting is mailed.  If no record date is fixed for the determination of
shareholders entitled to a distribution (other than one involving a purchase,
redemption, or other acquisition of the Corporation's own shares), the record
date shall be the date on which the Board adopted the resolution declaring the
distribution.  If no record date is fixed for determining shareholders entitled
to a share dividend, the record date shall be the date on which the Board of
Directors authorized the dividend.

                                      SECTION 5

                              BOOKS, RECORDS AND RECORDS

     5.1  RECORDS OF CORPORATE MEETINGS, ACCOUNTING RECORDS AND SHARE REGISTERS.

          5.1.1     The Corporation shall keep, as permanent records, minutes of
all meetings of the Board of Directors and shareholders, and all actions taken
without a meeting, and all actions taken by a committee exercising the authority
of the Board of Directors.  The Corporation or its agents shall maintain, in a
form that permits preparation of a list, a list of the names and addresses of
its shareholders, in alphabetical order by class of shares, showing the number,
class, and series, if any, of shares held by each.

          5.1.2     The Corporation shall also maintain appropriate accounting
records, and at its principal place of business shall keep copies of: (a) its
Articles of Incorporation or restated Articles of Incorporation and all
amendments in effect; (b) its Bylaws or restated Bylaws and all amendments in
effect; (c) minutes of all shareholders' and directors meetings and records of
all actions taken without meetings for the past three years; (d) appropriate
accounting records; (e) all written communications to shareholders generally in
the past three years; (f) a list of the names and business addresses of its
current officers and directors; and (g) its most recent annual report to the
Secretary of State.


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     5.2  COPIES OF CORPORATE RECORDS.  Any person dealing with the Corporation
may rely upon a copy of any of the records of the proceedings, resolutions, or
votes of the Board of Directors or shareholders, when certified by the
President, Vice President, Secretary or Assistant Secretary.

     5.3  EXAMINATION OF RECORDS.

          5.3.1     A shareholder shall have the right to inspect and copy,
during regular business hours at the principal office of the Corporation, in
person or by his or her attorney or agent, the corporate records referred to in
subsection 5.1.2 hereof if the shareholder gives the Corporation written notice
of the demand at least five business days before the date on which the
shareholder wishes to make such inspection.

          5.3.2     In addition, if a shareholder's demand is made in good faith
and for a proper purpose, a shareholder may inspect and copy, during regular
business hours at a reasonable location specified by the Corporation, excerpts
from minutes of any meeting of the Board of Directors, records of any action of
a committee of the Board of Directors, minutes of any meeting of the
shareholders, and records of actions taken by the shareholders or the Board of
Directors without a meeting, to the extent not subject to inspection under
subsection 5.3.1, accounting records of the Corporation, or the record of
shareholders; provided that the shareholder shall have made a demand describing
with reasonable particularity the shareholder's purpose and the records the
shareholder desires to inspect, and provided further that the records are
directly connected to the shareholder's purpose.

          5.3.3     This section shall not affect any right of shareholders to
inspect records of the Corporation that may be otherwise granted to the
shareholders by law.


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                                      SECTION 6

                                     FISCAL YEAR

     The fiscal year-end of the Corporation shall be May 31.

                                      SECTION 7

                                    CORPORATE SEAL

     The corporate seal of the Corporation, if any, shall be in the form shown
here.

                                      SECTION 8

                         MISCELLANEOUS PROCEDURAL PROVISIONS

     The Board of Directors may adopt rules of procedure to govern any meetings
of shareholders or directors to the extent not inconsistent with law, the
Articles of Incorporation, or these Bylaws, as they are in effect from time to
time.  In the absence of any rules of procedure adopted by the Board of
Directors, the chairman of the meeting shall make all decisions regarding the
procedures for any meeting.

                                      SECTION 9

                                 AMENDMENT OF BYLAWS

     The Board of Directors is expressly authorized to adopt, amend and repeal
the Bylaws of the Corporation, subject to approval by a majority of the
Continuing Directors (as defined in the Articles of Incorporation); provided,
however, the Board of Directors may not repeal or amend any bylaws that the
shareholders have expressly provided may not be amended or repealed by the Board
of Directors.  The shareholders of the Corporation also have the power to adopt,
amend or repeal the Bylaws of the Corporation by the affirmative vote of the
holders of not less than two-thirds of the outstanding shares and, to the
extent, if any, provided by resolution adopted by the Board of Directors
authorizing the issuance of a class or series of Preferred Stock, by the
affirmative vote of the holders of not less than two-thirds of the outstanding
shares of Common Stock and/or of such class or series of Preferred Stock, voting
as separate voting groups.


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<PAGE>

                                      SECTION 10

                       INDEMNIFICATION OF DIRECTORS AND OTHERS

     10.1 GRANT OF INDEMNIFICATION.  Subject to Section 10.2, each person who
was or is made a party or is threatened to be made a party to or is involved
(including, without limitation, as a witness) in any threatened, pending, or
completed action, suit or proceeding, whether formal or informal, civil,
criminal, administrative or investigative (hereinafter "proceeding"), by reason
of the fact that he or she is or was a director of the Corporation or who, while
a director of the Corporation, is or was serving at the request of the
Corporation as a director, officer, employee or agent of this or another
corporation or of a partnership, joint venture, trust, other enterprise, or
employee benefit plan, whether the basis of such proceeding is alleged action in
an official capacity as a director or in any other capacity while serving as a
director, officer, employee or agent, shall be indemnified and held harmless by
the Corporation to the fullest extent permitted by applicable law, as then in
effect, against all expense, liability and loss (including attorneys' fees,
costs, judgments, fines, ERISA excise taxes or penalties and amounts to be paid
in settlement) reasonably incurred or suffered by such person in connection
therewith, and such indemnification shall continue as to a person who has ceased
to be a director and shall inure to the benefit of his or her heirs, executors
and administrators.

     10.2 LIMITATIONS ON INDEMNIFICATION.  Notwithstanding Section 10.1, no
indemnification shall be provided hereunder to any such person to the extent
that such indemnification would be prohibited by the Oregon Business Corporation
Act or other applicable law as then in effect, nor, except as provided in
Section 10.4 with respect to proceedings seeking to enforce rights to
indemnification, shall the Corporation indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated by
such person except where such proceeding (or part thereof) was authorized by the
Board of Directors of the Corporation.

     10.3 ADVANCEMENT OF EXPENSES.  The right to indemnification conferred in
this Section 10 shall include the right to be paid by the Corporation the
expenses incurred in defending any such proceeding in advance of its final
disposition, except where the Board of Directors shall have adopted a resolution
expressly disapproving such advancement of expenses.

     10.4 RIGHT TO ENFORCE INDEMNIFICATION.  If a claim under Section 10.1 is
not paid in full by the Corporation within 60 days after a written claim has
been received by the Corporation, or if a claim for expenses incurred in
defending a proceeding in advance of its final disposition authorized under
Section 10.3 is not paid within 60 days after a written claim has been received
by the Corporation, the claimant may at any time thereafter bring suit against
the Corporation to recover the unpaid amount of the claim and, to the extent
successful in whole or in part, the claimant shall be entitled to be paid also
the expense of prosecuting such claim.  The claimant shall be presumed to be
entitled to indemnification hereunder upon submission of a written claim (and,
in an action brought to enforce a claim for expenses 


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<PAGE>


incurred in defending any proceeding in advance of its final disposition, 
where the required undertaking has been tendered to the Corporation), and 
thereafter the Corporation shall have the burden of proof to overcome the 
presumption that the claimant is so entitled.  It shall be a defense to any 
such action (other than action with respect to expenses authorized under 
Section 10.3) that the claimant has not met the standards of conduct which 
make it permissible hereunder or under the Oregon Business Corporation Act 
for the Corporation to indemnify the claimant for the amount claimed, but the 
burden of proving such defense shall be on the Corporation.

     10.5 ALTERNATIVE PROCEDURES.  Pursuant to ORS 60.414 or any successor
provision of the Oregon Business Corporation Act, the procedures for
indemnification and advancement of expenses set forth in this section are in
lieu of the procedures required by ORS 60.404 or any successor provision of the
Oregon Business Corporation Act.

     10.6 NONEXCLUSIVITY.  The right to indemnification and the advancement of
expense conferred in this Section 10 shall not be exclusive of any other right
which any person may have or hereafter acquire under any statute, provision of
the Articles of Incorporation or the Bylaws of the Corporation, general or
specific action of the Board, contract or otherwise.

     10.7 INDEMNIFICATION OF OFFICERS, EMPLOYEES AND AGENTS.  The Corporation
may, by action of its Board of Directors from time to time, provide
indemnification and pay expenses in advance of the final disposition of a
proceeding to officers, employees and agents of the Corporation on the same
terms with the same scope and effect as the provisions of this section with
respect to the indemnification and advancement of expenses of directors of the
Corporation or pursuant to rights granted pursuant to, or provided by, the
Oregon Business Corporation Act or such other terms as the Board may deem
proper.

     10.8 INSURANCE AND OTHER SECURITY.  The Corporation may maintain insurance,
at its expense, to protect itself and any individual who is or was a director,
officer, employee or agent of the Corporation or another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against or incurred by the individual in that capacity or arising from
his or her status as an officer, director, agent or employee, whether or not the
Corporation would have the power to indemnify such person against the same
liability under the Oregon Business Corporation Act.  The Corporation may enter
into contracts with any director or officer of the Corporation in furtherance of
the provisions of this Section 10 and may create a trust fund, grant a security
interest or use other means (including, without limitation, a letter of credit)
to ensure the payment of such amounts as may be necessary to effect
indemnification as provided in this Section 10.

     10.9 AMENDMENT OR MODIFICATION.  This Section 10 may be altered or amended
at any time as provided in these Bylaws, but no such amendment shall have the
effect of diminishing the rights of any person who is or was an officer or
director as to any acts or omissions taken or omitted to be taken prior to the
effective date of such amendment.

     10.10     EFFECT OF SECTION.  The rights conferred by this section shall be
deemed to be contract rights between the Corporation and each person who is or
was a director or officer.  


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<PAGE>

The Corporation expressly intends each such person to rely on the rights 
conferred hereby in performing his or her respective duties on behalf of the 
Corporation.

                                      SECTION 11

                    REPRESENTATION OF SHARES OF OTHER CORPORATIONS

     Unless otherwise restricted by the Board of Directors, the President and
any Vice President of the Corporation are each authorized to vote, represent and
exercise on behalf of the Corporation all rights incident to any and all shares
of other corporations standing in the name of the Corporation.  This authority
may be exercised by such officers either in person or by a duly executed proxy
or power of attorney.



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