EXHIBIT 3(i)
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ARTICLES OF INCORPORATION
OF
BUCS FINANCIAL CORP
The undersigned, Herbert J. Moltzan, whose address is 10455 Mill Run
Road, Owings Mills, Maryland 21117, being at least 18 years of age, acting as
incorporator, does hereby form a corporation under the general laws of the State
of Maryland having the following Articles of Incorporation:
Article 1. Name. The name of the corporation is BUCS Financial Corp
(hereinafter, the "Company").
Article 2. Principal Office. The address of the initial registered
office of the Company is 10455 Mill Run Road Owings Mills, Maryland 21117.
Article 3. Powers. The Company is organized under the General
Corporation Law, as amended, for the State of Maryland (the "MGCL") for the
purpose of engaging in any lawful act or activity for which a corporation may be
organized under the laws of the State of Maryland.
Article 4. Registered Agent. The name and mailing address of the
initial resident agent of the corporation in the State of Maryland is Herbert J.
Moltzan 10455 Mill Run Road, Owings Mills, Maryland 21117. The resident agent is
a citizen of the State of Maryland and actually resides therein.
Article 5. Duration. The term of the existence of the Company shall be
perpetual.
Article 6. Capital Stock.
A. Authorized Amount. The total number of shares of capital stock that
the Company has authority to issue is 7,000,000 of which 2,000,000 shall be
serial preferred stock, par value $0.10 per share (hereinafter, the "Preferred
Stock") and 5,000,000 shall be common stock, par value $0.10 per share
(hereinafter, the "Common Stock"). Except to the extent required by governing
law, rule, or regulation, the shares of capital stock may be issued from time to
time by the board of directors of the Company (hereinafter, the "Board of
Directors") without further approval of stockholders. The Company shall have the
authority to purchase its capital stock out of funds lawfully available
therefor. A description of the different classes and a statement of the relative
powers, designations, preferences and rights of the shares (if any) of capital
stock, and the qualifications, limitations or restrictions thereof are as
follows:
B. Common Stock. Except as provided in this Article 6 (or in any
resolution or resolutions adopted by the Board of Directors pursuant hereto),
the exclusive voting power shall
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be vested in the Common Stock, with each holder thereof being entitled to one
vote for each share of such Common Stock standing in the holder's name on the
books of the Company. Subject to any rights and preferences of any class of
stock having preference over the Common Stock, holders of Common Stock shall be
entitled to such dividends as may be declared by the Board of Directors out of
funds lawfully available therefor. Upon any liquidation, dissolution, or winding
up of the affairs of the Company, whether voluntary or involuntary, holders of
Common Stock shall be entitled to receive pro rata the remaining assets of the
Company after the holders of any class of stock having preference over the
Common Stock have been paid in full any sums to which they may be entitled. Each
share of common stock shall have the same relative powers, preferences, and
rights as, and shall be identical in all respects with, all the other shares of
common stock of the corporation.
C. Authority of Board to Fix Terms of Preferred Stock. A description of
each class of shares and a statement of the voting rights, designations,
preferences, qualifications, privileges, limitations, options, conversion
rights, and other special rights granted to or imposed upon the shares of each
class and of the authority vested in the Board of Directors to establish series
of Preferred Stock or to determine that Preferred Stock will be issued as a
class without series and to fix and determine the voting rights, designations,
preferences, and other special rights of the Preferred Stock as a class or of
the series thereof are as follows:
Preferred Stock may be issued from time to time as a class without
series or in one or more series. Each series shall be designated in
supplementary sections or amendments to these Articles of Incorporation by the
Board of Directors so as to distinguish the shares thereof from the shares of
all other series and classes. The Board of Directors may by resolution and
amendment to these Articles of Incorporation from time to time divide shares of
Preferred Stock into series, or determine that the Preferred Stock shall be
issued as a class without series, fix and determine the number of shares in a
series and the terms and conditions of the issuance of the class or the series,
and, subject to the provisions of this Article 6, fix and determine the rights,
preferences, qualifications, privileges, limitations, and other special rights,
if any, of the class (if none of such shares of the class have been issued) or
of any series so established, including but not limited to, voting rights (which
may be limited, multiple, fractional, or non-voting rights), the rate of
dividend, if any, and whether or to what extent, if any, such dividends shall be
cumulative (including the date from which dividends shall be cumulative, if
any), the price at and the terms and conditions on which shares may be redeemed,
if any, the preference and the amounts payable on shares in the event of
voluntary or involuntary liquidation, sinking fund provisions for the redemption
or purchase of shares in the event shares of the class or of any series are
issued with sinking fund provisions, and the terms and conditions on which the
shares of the class or of any series may be converted in the event the shares of
the class or of any series are issued with the privilege of conversion.
The Board of Directors may, in its discretion, at any time or from time
to time, issue or cause to be issued all or any part of the authorized and
unissued shares of Preferred Stock for consideration of such character and value
as the Board of Directors shall from time to time fix or determine.
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D. Repurchase of Shares. The Company may, from time to time, pursuant
to authorization by the Board of Directors and without action by the
stockholders, purchase or otherwise acquire shares of any class, bonds,
debentures, notes, scrip, warrants, obligations, evidences of indebtedness, or
other securities of the Company in such manner, upon such terms, and in such
amounts as the Board of Directors shall determine; subject, however, to such
limitations or restrictions, if any, as are contained in the express terms of
any class of shares of the Company outstanding at the time of the purchase or
acquisition in question or as are imposed by law or regulation.
Article 7. Incorporator. The name and business address of the sole
incorporator is as follows:
Name Address
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Herbert J. Moltzan 10455 Mill Run Road Owings Mills, Maryland 21117
Article 8. Directors. The business and affairs of the Company shall be
managed by or under the direction of the Board of Directors.
A. Number. The number of directors of the Company shall be such number,
not less than 5 nor more than 15 (exclusive of directors, if any, to be elected
by holders of Preferred Stock, voting separately as a class), as shall be
provided from time to time in accordance with the bylaws, provided that no
decrease in the number of directors shall have the effect of shortening the term
of any incumbent director, and provided further that no action shall be taken to
decrease or increase the number of directors from time to time unless at least
eighty percent (80%) of the directors then in office shall concur in said
action.
B. Classified Board. The Board of Directors shall be divided into three
classes of directors that shall be designated Class I, Class II and Class III.
The members of each class shall be elected for a term of three years and until
their successors are elected and qualified. Such classes shall be as nearly
equal in number as the then total number of directors constituting the entire
Board of Directors shall permit, with the term of office of Class I to expire at
the first annual meeting of stockholders, the term of office of Class II to
expire at the annual meeting of stockholders one year thereafter, and the term
of office of Class III to expire at the annual meeting of stockholders two years
thereafter. At each annual meeting of stockholders following such initial
classification and election, directors elected to succeed those directors whose
terms expire shall be elected for a term of office to expire at the three
succeeding annual meetings of stockholders after their election.
Should the number of directors of the Company be reduced, the
directorship(s) eliminated shall be allocated among the classes so that the
number of directors in each class is as specified in the immediately preceding
paragraph. The Board of Directors shall designate, by the name of the
incumbent(s), the position(s) to be abolished. Should the number of directors of
the Company be increased, the additional directorships shall be allocated among
such classes so that the number of directors in each class is as specified in
the immediately preceding paragraph.
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Whenever the holders of any one or more series of Preferred Stock of
the Company shall have the right, voting separately as a class, to elect one or
more directors of the Company, the Board of Directors shall consist of said
directors so elected in addition to the number of directors fixed as provided
above in this Article 8. Notwithstanding the foregoing, and except as otherwise
may be required by law, whenever the holders of any one or more series of
Preferred Stock of the Company shall have the right, voting separately as a
class, to elect one or more directors of the Company, the terms of the director
or directors elected by such holders shall expire at the next succeeding annual
meeting of stockholders.
The initial board of directors shall consist of ten individuals divided
into the following classes:
Class I Class II Class III
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Joseph Pescrille Allen Maier Brian Bowers
Virginia Wampler Herbert J. Moltzan Harry Fox
Dale Summers M. Robin Copeland Peg Ohrt
Thomas Markel
C. No Cumulative Voting. Stockholders of the Company shall not be
permitted to cumulate their votes for the election of directors.
D. Vacancies. Subject to the rights of the holders of any series of
Preferred Stock then outstanding, any vacancy occurring on the Board of
Directors, including any vacancy created by reason of an increase in the number
of directors, shall be filled by a majority vote of the directors then in
office, whether or not a quorum is present, or by a sole remaining director, and
any director so chosen shall serve until the term of the class to which such
director was appointed shall expire and until a successor is elected and
qualified. When the number of directors is changed, the Board of Directors shall
determine the class or classes to which the increased or decreased number of
directors shall be appointed.
E. Removal. Notwithstanding any other provision of these Articles or
the Bylaws of the Corporation, no member of the board of directors of the
Corporation may be removed except for cause, and then only by the affirmative
vote of at least 80% of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors (considered
for this purpose as one class) cast at a meeting of the stockholders called for
that purpose. Notwithstanding the foregoing, whenever the holders of any one or
more series of preferred stock of the Corporation shall have the right, voting
separately as a class, to elect one or more directors of the Corporation, the
preceding provisions of this Article 8.E shall not apply with respect to the
director or directors elected by such holders of preferred stock.
F. Nominations of Directors. Nominations of candidates for election as
directors at any annual meeting of stockholders may be made (a) by, or at the
direction of, a majority of the Board of Directors or (b) by any stockholder
entitled to vote at such annual meeting. Only persons nominated in accordance
with the procedures set forth in this Article 8.F shall be eligible for
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election as directors at an annual meeting. Ballots bearing the names of all the
persons who have been nominated for election as directors at an annual meeting
in accordance with the procedures set forth in this Article 8.F shall be
provided for use at the annual meeting.
Nominations, other than those made by or at the direction of the Board
of Directors, shall be made pursuant to timely notice in writing to the
Secretary of the Company as set forth in this Article 8.F. To be timely, a
stockholder's notice shall be delivered to, or mailed and received at, the
principal executive offices of the Company not less than 60 days after the
Company's fiscal year end. Such stockholder's notice shall set forth (a) as to
each person whom the stockholder proposes to nominate for election or
re-election as a director and as to the stockholder giving the notice (i) the
name, age, business address, and residence address of such person, (ii) the
principal occupation or employment of such person, (iii) the class and number of
shares of Company stock that are Beneficially Owned (as determined by Rule 13d-3
promulgated under the Securities Exchange Act of 1934, as amended) by such
person on the date of such stockholder notice, and (iv) any other information
relating to such person that is required to be disclosed in solicitations of
proxies with respect to nominees for election as directors, pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act") or any
successor thereto; and (b) as to the stockholder giving the notice (i) the name
and address, as they appear on the Company's books, of such stockholder and any
other stockholders known by such stockholder to be supporting such nominees and
(ii) the class and number of shares of Company stock that are Beneficially Owned
by such stockholder on the date of such stockholder notice and, to the extent
known, by any other stockholders known by such stockholder to be supporting such
nominees on the date of such stockholder notice. At the request of the Board of
Directors, any person nominated by, or at the direction of, the Board of
Directors for election as a director at an annual meeting shall furnish to the
Secretary of the Company the same information required to be set forth in a
stockholder's notice of nomination which pertains to the nominee.
The Board of Directors may reject any nomination by a stockholder not
timely made in accordance with the requirements of this Article 8.F. The
Secretary of the Company shall notify a stockholder in writing whether such
person's nomination has been made in accordance with the time and informational
requirements of this Article 8.F. Notwithstanding the procedures set forth in
this paragraph, if neither the Board of Directors nor such committee makes a
determination as to the validity of any nominations by a stockholder, the
presiding officer of the annual meeting shall determine and declare at the
annual meeting whether the nomination was made in accordance with the terms of
this Article 8.F. If the presiding officer determines that a nomination was made
in accordance with the terms of this Article 8.F, such person shall so declare
at the annual meeting and ballots shall be provided for use at the meeting with
respect to such nominee. If the presiding officer determines that a nomination
was not made in accordance with the terms of this Article 8.F, such person shall
so declare at the annual meeting and the defective nomination shall be
disregarded.
Notwithstanding the foregoing, and except as otherwise required by law,
whenever the holders of any one or more series of Preferred Stock shall have the
right, voting separately as a class, to elect one or more directors of the
Company, the provisions of this Article 8.F shall not apply with respect to the
director or directors elected by such holders of Preferred Stock.
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Article 9. Preemptive Rights. No holder of any of the shares of any
class or series of stock or of options, warrants, or other rights to purchase
shares of any class or series or of other securities of the Company shall have
any preemptive right to purchase or subscribe for any unissued stock of any
class or series, any unissued bonds, certificates of indebtedness, debentures,
or other securities convertible into or exchangeable for stock of any class or
series or carrying any right to purchase stock of any class or series, or any
shares of any class, bonds, debentures, notes, scrip, warrants, obligations,
evidences of indebtedness, or other securities of the Company purchased by the
Company pursuant to Article 6.D; but any such unissued, or issued but not
outstanding, stock, bonds, certificates of indebtedness, debentures, or other
securities convertible into or exchangeable for stock or carrying any right to
purchase stock may be issued pursuant to resolution of the Board of Directors to
such persons, firms, corporations, or associations, whether or not holders
thereof, and upon such terms as may be deemed advisable by the Board of
Directors in the exercise of its sole discretion.
Article 10. Elimination of Directors' and Officers' Liability. An
officer or director of the Corporation, as such, shall not be liable to the
Corporation or its stockholders for money damages, except (i) to the extent that
it is proved that the person actually received an improper benefit or profit in
money, property or services for the amount of the benefit or profit in money,
property or services actually received; (ii) to the extent that a judgment or
other final adjudication averse to the person is entered in a proceeding based
on a finding in the proceeding that the person's action, or failure to act, was
committed in bad faith or was the result of active and deliberate dishonesty and
was material to the cause of action adjudicated in the proceeding; or (iii) to
the extent otherwise required by Maryland law. If Maryland law is amended to
further eliminate or limit the personal liability of officers and directors,
then the liability of officers and directors of the Corporation shall be
eliminated or limited to the fullest extent permitted by Maryland law, as so
amended.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Company shall not adversely affect any right or protection
of a director of the Company existing at the time of such repeal or
modification.
Article 11. Indemnification, etc. of Officers, Directors, Employees,
and Agents.
A. Persons. The Company shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending, or
completed action, suit, or proceeding, including actions by or in the right of
the Company, whether civil, criminal, administrative, or investigative, by
reason of the fact that such person is or was a director, officer, employee,
fiduciary, trustee, or agent of the Company, or is or was serving at the request
of the Company as a director, officer, employee, fiduciary, trustee, or agent of
another corporation, partnership, joint venture, trust, or other enterprise.
B. Extent -- Derivative Actions. In the case of a threatened, pending,
or completed action or suit by or in the right of the Company against a person
named in paragraph A by reason of such person holding a position named in
paragraph A, the Company shall indemnify such person if such person satisfies
the standard in paragraph C, for expenses (including attorneys' fees)
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actually and reasonably incurred by such person in connection with the defense
or settlement of the action or suit.
C. Standard -- Derivative Suits. In the case of a threatened, pending,
or completed action or suit by or in the right of the Company, a person named in
paragraph A shall be indemnified only if:
1. such person is successful on the merits or otherwise; or
2. such person acted in good faith in the transaction that is
the subject of the suit or action, and in a manner reasonably believed
to be in, or not opposed to, the best interests of the Company,
including, but not limited to, the taking of any and all actions in
connection with the Company's response to any tender offer or any offer
or proposal of another party to engage in a Business Combination (as
defined in Article 14 of these Articles) not approved by the Board of
Directors. However, such person shall not be indemnified in respect of
any claim, issue, or matter as to which such person has been adjudged
liable to the Company unless (and only to the extent that) the court of
common pleas or the court in which the suit was brought shall
determine, upon application, that despite the adjudication of liability
but in view of all the circumstances, such person is fairly and
reasonably entitled to indemnity for such expenses as the court shall
deem proper.
D. Extent -- Nonderivative Suits. In case of a threatened, pending, or
completed suit, action, or proceeding (whether civil, criminal, administrative,
or investigative), other than a suit by or in the right of the Company, together
hereafter referred to as a nonderivative suit, against a person named in
paragraph A by reason of such person holding a position named in paragraph A,
the Company shall indemnify such person if such person satisfies the standard in
paragraph E, for amounts actually and reasonably incurred by such person in
connection with the defense or settlement of the nonderivative suit, including,
but not limited to (i) expenses (including attorneys' fees), (ii) amounts paid
in settlement, (iii) judgments, and (iv) fines.
E. Standard -- Nonderivative Suits. In case of a nonderivative suit, a
person named in paragraph A shall be indemnified only if:
1. such person is successful on the merits or otherwise; or
2. such person acted in good faith in the transaction that is
the subject of the nonderivative suit and in a manner such person
reasonably believed to be in, or not opposed to, the best interests of
the Company, including, but not limited to, the taking of any and all
actions in connection with the Company's response to any tender offer
or any offer or proposal of another party to engage in a Business
Combination (as defined in Article 14 of these Articles) not approved
by the Board of Directors and, with respect to any criminal action or
proceeding, such person had no reasonable cause to believe such
person's conduct was unlawful. The termination of a nonderivative suit
by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent shall not,
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in itself, create a presumption that the person failed to satisfy the
standard of this paragraph E.2.
F. Determination That Standard Has Been Met. A determination that the
standard of paragraph C or E has been satisfied may be made by a court, or,
except as stated in paragraph C.2 (second sentence), the determination may be
made by:
1. the Board of Directors by a majority vote of a quorum
consisting of directors of the Company who were not parties to the
action, suit, or proceeding;
2. if such a quorum is not obtainable or if obtainable
and a majority of a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion; or
3. the stockholders of the Company.
G. Proration. Anyone making a determination under paragraph F may
determine that a person has met the standard as to some matters but not as to
others, and may reasonably prorate amounts to be indemnified.
H. Advancement of Expenses. Reasonable expenses incurred by a director,
officer, employee, or agent of the Company in defending a civil or criminal
action, suit, or proceeding described in Article 11.A may be paid by the Company
in advance of the final disposition of such action, suit, or proceeding upon
receipt of an undertaking by or on behalf of such person to repay such amount if
it shall ultimately be determined that the person is not entitled to be
indemnified by the Company.
I. Other Rights. The indemnification and advancement of expenses
provided by or pursuant to this Article 11 shall not be deemed exclusive of any
other rights to which those seeking indemnification or advancement of expenses
may be entitled under any insurance or other agreement, vote of stockholders or
directors, or otherwise, both as to actions in their official capacity and as to
actions in another capacity while holding an office, and shall continue as to a
person who has ceased to be a director, officer, employee, or agent and shall
inure to the benefit of the heirs, executors, and administrators of such person.
J. Insurance. The Company 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 Company, or is or was serving at the request of the Company as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise, against any liability asserted against such
person and incurred by such person in any such capacity, or arising out of such
person's status as such, whether or not the Company would have the power to
indemnify such person against such liability under the provisions of this
Article 11.
K. Security Fund; Indemnity Agreements. By action of the Board of
Directors (notwithstanding their interest in the transaction), the Company may
create and fund a trust fund
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or fund of any nature, and may enter into agreements with its officers,
directors, employees, and agents for the purpose of securing or insuring in any
manner its obligation to indemnify or advance expenses provided for in this
Article 11.
L. Modification. The duties of the Company to indemnify and to advance
expenses to any person as provided in this Article 11 shall be in the nature of
a contract between the Company and each such person, and no amendment or repeal
of any provision of this Article 11, and no amendment or termination of any
trust or other fund created pursuant to Article 11.K hereof, shall alter to the
detriment of such person the right of such person to the advancement of expenses
or indemnification related to a claim based on an act or failure to act which
took place prior to such amendment, repeal, or termination.
M. Proceedings Initiated by Indemnified Persons. Notwithstanding any
other provision in this Article 11, the Company shall not indemnify a director,
officer, employee, or agent for any liability incurred in an action, suit, or
proceeding initiated by (which shall not be deemed to include counter-claims or
affirmative defenses) or participated in as an intervenor or amicus curiae by
the person seeking indemnification unless such initiation of or participation in
the action, suit, or proceeding is authorized, either before or after its
commencement, by the affirmative vote of a majority of the directors then in
office.
N. Savings Clause. If this Article 11 or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Company shall nevertheless indemnify each director, officer, employee, and agent
of the Company as to costs, charges, and expenses (including attorneys' fees),
judgments, fines, and amounts paid in settlement with respect to any action,
suit, or proceeding, whether civil, criminal, administrative, or investigative,
including an action by or in the right of the Company to the fullest extent
permitted by any applicable portion of this Article 11 that shall not have been
invalidated and to the fullest extent permitted by applicable law.
If the laws of the State of Maryland are amended to permit further
indemnification of the directors, officers, employees, and agents of the
Company, then the Company shall indemnify such persons to the fullest extent
permitted by law. Any repeal or modification of this Article by the stockholders
of the Company shall not adversely affect any right or protection of a director,
officer, employee, or agent existing at the time of such repeal or modification.
Article 12. Meetings of Stockholders and Stockholder Proposals.
A. Special Meetings of Stockholders. Special meetings of the
stockholders of the Corporation for any purpose or purposes may be called at any
time by a majority of the board of directors of the Corporation, or by a
committee of the board of directors which has been duly designated by the board
of directors and whose powers and authorities, as provided in a resolution of
the board of directors or in the Bylaws of the Corporation, include the power
and authority to call such meetings. Special meetings shall also be called by
the secretary of the Corporation upon the written request of stockholders
entitled to cast at least 50 percent of all votes entitled to be cast at the
meeting.
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B. Action Without a Meeting. Notwithstanding any other provision of
these Articles or the Bylaws of the Company, no action required to be taken or
which may be taken at any annual or special meeting of the stockholders of the
Company may be taken without a meeting, and the power of stockholders to consent
in writing, without a meeting, to the taking of any action is specifically
denied.
C. General Right to Vote; Proxies. Each stockholder entitled to vote at
a meeting of stockholders or to express consent or dissent to corporate action
in writing without a meeting may authorize another person or persons to act for
him by proxy, but no such proxy shall be voted or acted upon after 11 months
from its date, unless the proxy provides for a longer period. Without limiting
the manner in which a stockholder may authorize another person or persons to act
for him as proxy, the following shall constitute a valid means by which a
stockholder may grant such authority.
1. A stockholder may execute a writing authorizing another person or
persons to act for him as proxy. Execution may be accomplished by the
stockholder or his authorized officer, director, employee or agent signing such
writing or causing his or her signature to be affixed to such writing by any
reasonable means including, but not limited to, facsimile signature.
2. A stockholder may authorize another person or persons to act for him
as proxy by transmitting or authorizing the transmission of an authorization to
(i) the person authorized to act as proxy; or (ii) any other person authorized
to receive the proxy authorization on behalf of the person authorized to act as
the proxy, including a proxy solicitation firm or proxy support service
organization. The authorization may be transmitted by a telegram, cablegram,
datagram, electronic mail or any other electronic or telephonic transmission.
3. Any copy, facsimile, telecommunication or other reliable
reproduction of the writing or transmission created pursuant to this section may
be substituted or used in lieu of the original writing or transmission for any
and all purposes for which the original writing or transmission could be used.
D. Place of Meeting. Meetings of stockholders may be held within or
without the State of Maryland, as the Bylaws of the Corporation may provide.
E. Stockholder Proposals. At an annual meeting of stockholders, only
such new business shall be conducted, and only such proposals shall be acted
upon, as shall have been brought before the annual meeting by, or at the
direction of, (1) the Board of Directors or (2) any stockholder of the Company
who complies with all the requirements set forth in this Article 12.E.
Proposals, other than those made by or at the direction of the Board of
Directors, shall be made pursuant to timely notice in writing to the Secretary
of the Company as set forth in this Article 12.E. For stockholder proposals to
be considered at the annual meeting of stockholders, the stockholder's notice
shall be delivered to, or mailed and received at, the principal executive
offices of the Company not less than 60 days after the Company's fiscal year
end. Such
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stockholder's notice shall set forth as to each matter the stockholder proposes
to bring before the annual meeting (a) a brief description of the proposal
desired to be brought before the annual meeting and the reasons for conducting
such business at the annual meeting, (b) the name and address, as they appear on
the Company's books, of the stockholder proposing such business and, to the
extent known, any other stockholders known by such stockholder to be supporting
such proposal, (c) the class and number of shares of the Company stock that are
Beneficially Owned by the stockholder on the date of such stockholder notice
and, to the extent known, by any other stockholders known by such stockholder to
be supporting such proposal on the date of such stockholder notice, and (d) any
financial interest of the stockholder in such proposal (other than interests
which all stockholders would have).
The Board of Directors may reject any stockholder proposal not timely
made in accordance with the terms of this Article 12.E. The Secretary of the
Company shall notify a stockholder in writing whether such stockholder's
proposal has been made in accordance with the time and informational
requirements of this Article 12.E. Notwithstanding the procedures set forth in
this paragraph, if neither the Board of Directors nor such committee makes a
determination as to the validity of any stockholder proposal, the presiding
officer of the annual meeting shall determine and declare at the annual meeting
whether the stockholder proposal was made in accordance with the terms of this
Article 12.E. If the presiding officer determines that a stockholder proposal
was made in accordance with the terms of this Article 12.E, such person shall so
declare at the annual meeting and ballots shall be provided for use at the
meeting with respect to any such proposal. If the presiding officer determines
that a stockholder proposal was not made in accordance with the terms of this
Article 12.E, such person shall so declare at the annual meeting and any such
proposal shall not be acted upon at the annual meeting.
This provision shall not prevent the consideration and approval or
disapproval at the annual meeting of report of officers, directors, and
committees of the Board of Directors, but in connection with such reports, no
new business shall be acted upon at such annual meeting unless stated, filed,
and received as herein provided.
Article 13. Certain Limitations on Voting Rights
A. Limitations. Notwithstanding any other provision of these Articles,
in no event shall any record owner of any outstanding Common Stock which is
beneficially owned, directly or indirectly, by a person who, as of any record
date for the determination of stockholders entitled to vote on any matter,
beneficially owns in excess of 10% of the then-outstanding shares of Common
Stock (the "Limit"), be entitled, or permitted to any vote in respect of the
shares held in excess of the Limit. The number of votes which may be cast by any
record owner by virtue of the provisions hereof in respect of Common Stock
beneficially owned by such person owning shares in excess of the Limit shall be
a number equal to the total number of votes which a single record owner of all
Common Stock owned by such person would be entitled to cast, multiplied by a
fraction, the numerator of which is the number of shares of such class or series
which are both beneficially owned by such person and owned of record by such
record owner and the denominator of which is the total number of shares of
Common Stock beneficially owned by such Person
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owning shares in excess of the Limit. This Article 13 is intended to apply in
lieu of Subtitle 7 of Maryland General Corporation Law or any successor
provision.
Further, for a period of five years from the completion of the
conversion of BUCS Federal from mutual to stock form, no Person shall directly
or indirectly Offer to acquire or acquire the beneficial ownership of more than
10% of any class of any equity security of the Company.
B. Definitions. The following definitions shall apply to this Article
13.
1. "Affiliate" shall have the meaning ascribed to it in Rule
12b-2 of the General Rules and Regulations under the Securities
Exchange Act of 1934, as in effect on the date of filing of this
Certificate.
2. "Beneficial Ownership" (including "Beneficially Owned")
shall be determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Securities Exchange Act of 1934 (or any successor
rule or statutory provision), or, if said Rule 13d-3 shall be rescinded
and there shall be no successor rule or provision thereto, pursuant to
said Rule 13d-3 as in effect on the date of filing of this Certificate;
provided, however, that a Person shall, in any event, also be deemed
the "beneficial owner" of any Common Stock:
(a) which such Person or any of its Affiliates owns,
directly or indirectly; or
(b) which such Person or any of its Affiliates has
(i) the right to acquire (whether such right is exercisable
immediately or only after the passage of time), pursuant to
any agreement, arrangement or understanding (but shall not be
deemed to be the Beneficial Owner of any Voting Shares (as
defined in Article 14) solely by reason of an agreement,
contract, or other arrangement with this Company to effect any
transaction which is described in Section A of Article 14) or
upon the exercise of conversion rights, exchange rights,
warrants, or options or otherwise, or (ii) sole or shared
voting or investment power with respect thereto pursuant to
any agreement, arrangement, understanding, relationship or
otherwise (but shall not be deemed to be the Beneficial Owner
of any Voting Shares solely by reason of a revocable proxy
granted for a particular meeting of stockholders, pursuant to
a public solicitation of proxies for such meeting, with
respect to shares of which neither such Person nor any such
Affiliate is otherwise deemed the Beneficial Owner); or
(c) which are owned directly or indirectly, by any
other Person with which such first mentioned Person or any of
its Affiliates acts as a partnership, limited partnership,
syndicate or other group pursuant to any agreement,
arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of any shares of capital stock of
this Company;
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and provided further, however, that (1) no director or officer of this Company
(or any Affiliate of any such director or officer) shall, solely by reason of
any or all of such directors or officers acting in their capacities as such, be
deemed, for any purposes hereof, to Beneficially Own any Common Stock
Beneficially Owned by any other such director or officer (or any Affiliate
thereof), and (2) neither any employee stock ownership or similar plan of this
Company or any subsidiary of this Company, nor any trustee with respect thereto
or any Affiliate of such trustee (solely by reason of such capacity of such
trustee), shall be deemed, for any purposes hereof, to Beneficially Own any
Common Stock held under any such plan. For purposes of computing the percentage
Beneficial Ownership of Common Stock of a Person, the outstanding Common Stock
shall include shares deemed owned by such Person through application of this
subsection but shall not include any other Common Stock which may be issuable by
this Company pursuant to any agreement, or upon exercise of conversion rights,
warrants or options, or otherwise. For all other purposes, the outstanding
Common Stock shall include only Common Stock then outstanding and shall not
include any Common Stock which may be issuable by this Company pursuant to any
agreement, or upon the exercise of conversion rights, warrants or options, or
otherwise.
3. The term "Offer" shall mean every written offer to buy or
acquire, solicitation of an offer to sell, tender offer or request or invitation
for tender of, a security or interest in a security for value; provided that the
term "Offer" shall not include (i) inquiries directed solely to the management
of the Company and not intended to be communicated to stockholders which are
designed to elicit an indication of management's receptivity to the basic
structure of a potential acquisition with respect to the amount of cash and or
securities, manner of acquisition and formula for determining price, or (ii)
non-binding expressions of understanding or letters of intent with the
management of the Company regarding the basic structure of a potential
acquisition with respect to the amount of cash and/or securities, manner of
acquisition and formula for determining price.
4. A "Person" shall mean any individual, firm, corporation,
or other entity.
C. The board of directors shall have the power to construe and apply
the provisions of this Article 13 and to make all determinations necessary or
desirable to implement such provisions, including but not limited to matters
with respect to (i) the number of shares of Common Stock Beneficially Owned by
any Person, (ii) whether a Person is an Affiliate of another, (iii) whether a
Person has an agreement, arrangement, or understanding with another as to the
matters referred to in the definition of Beneficial Ownership, (iv) the
application of any other definition or operative provision of the section to the
given facts, or (v) any other matter relating to the applicability or effect of
this Article 13.
D. The board of directors shall have the right to demand that any
Person who is reasonably believed to Beneficially Own Common Stock in excess of
the Limit (or holders of record of Common Stock Beneficially Owned by any Person
in excess of the Limit) supply the Company with complete information as to (i)
the record owner(s) of all shares Beneficially Owned by such Person who is
reasonably believed to own shares in excess of the Limit and (ii) any other
factual matter relating to the applicability or effect of this Article 13 as may
reasonably be requested of such Person.
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<PAGE>
E. Except as otherwise provided by law or expressly provided in this
Article 13, the presence in person or by proxy of the holders of record of
shares of capital stock of the Company entitling the holders thereof to cast a
majority of the votes (after giving effect, if required, to the provisions of
this Article 13) entitled to be cast by the holders of shares of capital stock
of the Company entitled to vote shall constitute a quorum at all meetings of the
stockholders, and every reference in these Articles to a majority or other
proportion of capital stock (or the holders thereof) for purposes of determining
any quorum requirement or any requirement for stockholder consent or approval
shall be deemed to refer to such majority or other proportion of the votes (or
the holders thereof) then entitled to be cast in respect of such capital stock.
F. The provisions of this Article 13 shall not be applicable to any
tax-qualified defined benefit plan or defined contribution plan of the Company
or its subsidiaries or to the acquisition of more than 10% of any class of
equity security of the Company if such acquisition has been approved by a
resolution of Board of Directors, as described in Article 14 of this Article;
provided, however, that such approval shall only be effective if such Directors
shall have the power to construe and apply the provisions of this Article 13 and
to make all determinations necessary or desirable to implement such provisions,
including but not limited to matters with respect to (a) the number of shares
Beneficially Owned by any Person, (b) whether a Person has an agreement,
arrangement, or understanding with another as to the matters referred to in the
definition of Beneficial Ownership, (c) the application of any other material
fact relating to the applicability or effect of this Article 13. Any
constructions, applications, or determinations made by the Directors pursuant to
this Article 13 in good faith and on the basis of such information and
assistance as was then reasonably available for such purpose shall be conclusive
and binding upon the Company and its stockholders.
G. In the event any provision (or portion thereof) of this Article 13
shall be found to be invalid, prohibited or unenforceable for any reason, the
remaining provisions (or portions thereof) of this Article 13 shall remain in
full force and effect, and shall be construed as if such invalid, prohibited or
unenforceable provision had been stricken herefrom or otherwise rendered
inapplicable, it being the intent of this Company and its stockholders that each
such remaining provision (or portion thereof) of this Article 13 remain, to the
fullest extent permitted by law, applicable and enforceable as to all
stockholders, including stockholders owning an amount of stock over the Limit,
notwithstanding any such finding.
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<PAGE>
Article 14. Stockholder Approval of Business Combinations
A. Certain Definitions. For the purposes of this Article 14:
1. The term "Affiliate," including the term "affiliated person,"
means a person that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is
under common control with, a specified person.
2. The term "Associate," when used to indicate a relationship
with any person, means:
(a) any corporation or organization (other than the
corporation or a subsidiary of the corporation) of which such person is
an officer, director, or partner or is, directly or indirectly, the
beneficial owner of 10 percent or more of any class of equity
securities;
(b) any trust or other estate in which such person has a
substantial beneficial interest or as to which such person serves as
trustee or in a similar fiduciary capacity; and
(c) any relative or spouse of such person, or any relative of
such spouse, who has the same home as such person or who is a director
or officer of the corporation or any of its affiliates.
3. The term "Beneficial Owner," when used with respect to any voting
stock, means a person:
(a) That, individually or with any of its affiliates or
associates, beneficially owns voting stock, directly or
indirectly; or
(b) That, individually or with any of its affiliates or
associates, has:
(i) the right to acquire voting stock (whether such
right is exercisable immediately or only after the passage
of time), pursuant to any agreement, arrangement, or
understanding or upon the exercise of conversion rights,
exchange rights, warrants or options, or otherwise; or
(ii) the right to vote voting stock pursuant to any
agreement, arrangement, or understanding; or
(c) That has any agreement, arrangement, or understanding for
the purpose of acquiring, holding, voting, or disposing of voting stock
with any other person that beneficially owns, or whose affiliates or
associates beneficially own, directly or indirectly, such shares of
voting stock.
4. The term "Business Combination" means:
(a) Unless the merger, consolidation, or share exchange does
not alter the contract rights of the stock as expressly set forth in
the charter or change or convert in whole or in part the outstanding
shares of stock of the corporation, any merger, consolidation, or share
exchange of the corporation or any subsidiary with (i) any Interested
Stockholder or (ii) any other corporation (whether or not itself an
Interested Stockholder) which is, or after the merger, consolidation,
or share exchange would be, an
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<PAGE>
affiliate of an Interested Stockholder that was an Interested
Stockholder prior to the transaction;
(b) any sale, lease, transfer, or other disposition, other
than in the ordinary course of business or pursuant to a dividend or
any other method affording substantially proportionate treatment to the
holders of voting stock, in one transaction or a series of transactions
in any 12-month period, to any Interested Stockholder or any affiliate
of any Interested Stockholder (other than the corporation or any of its
subsidiaries) of any assets of the corporation or any subsidiary
having, measured at the time the transaction or transactions are
approved by the board of directors of the corporation, an aggregate
book value as of the end of the corporation's most recently ended
fiscal quarter of 10 percent or more of the total market value of the
outstanding stock of the corporation or of its net worth as of the end
of its most recently ended fiscal quarter;
(c) the issuance or transfer by the corporation, or any
subsidiary, in one transaction or a series of transactions, of any
equity securities of the corporation or any subsidiary which have an
aggregate market value of 5 percent or more of the total market value
of the outstanding stock of the corporation to any Interested
Stockholder or any affiliate of any Interested Stockholder (other than
the corporation or any of its subsidiaries) except pursuant to the
exercise of warrants or rights to purchase securities offered pro rata
to all holders of the corporation's voting stock or any other method
affording substantially proportionate treatment to the holders of
voting stock;
(d) the adoption of any plan or proposal for the liquidation
or dissolution of the corporation in which anything other than cash
will be received by an Interested Stockholder or any affiliate of any
Interested Stockholder;
(e) Any reclassification of securities (including any reverse
stock split), or recapitalization of the corporation, or any merger,
consolidation, or share exchange of the corporation with any of its
subsidiaries which has the effect, directly or indirectly, in one
transaction or a series of transactions, of increasing by five percent
or more the total number of outstanding shares, the proportionate
amount of the outstanding shares of any class of equity securities of
the corporation or any subsidiary which is directly or indirectly owned
by any Interested Stockholder or any affiliate of any Interested
Stockholder; or
(f) the receipt by any Interested Stockholder or any affiliate
of any Interested Stockholder (other than the corporation or any of its
subsidiaries) of the benefit, directly or indirectly (except
proportionately as a stockholder), of any loan, advance, guarantee,
pledge or other financial assistance or any tax credit or other tax
advantage provided by the corporation or any of its subsidiaries.
5. The term "Control," including the terms "controlling,"
"controlled by" and "under common control with," means the
possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a
person, whether through the ownership of voting securities, by
contract, or otherwise, and the beneficial ownership of 10
percent or more of the votes entitled to be cast by a
corporation's voting stock creates a presumption of control.
6. The term "Determination Date" means the most recent date on
which an Interested Stockholder became an Interested
Stockholder.
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<PAGE>
7. The term "Equity Security" means:
(a) any stock or similar security, certificate of interest, or
participation in any profit sharing agreement, voting trust certificate,
or certificate of deposit for an equity security;
(b) any security convertible, with or without consideration,
into an equity security, or any warrant or other security carrying any
right to subscribe to or purchase an equity security; or
(c) any put, call, straddle, or other option or privilege of
buying an equity security from or selling an equity security to another
without being bound to do so.
8. The term "Interested Stockholder" means any person (other than
the corporation or any subsidiary) that:
(a)(i) is the beneficial owner, directly or indirectly, of 10
percent or more of the voting power of the outstanding voting stock of
the corporation after the date on which the corporation had 100 or more
beneficial owners of its stock; or
(ii) is an affiliate or associate of the corporation and was
the beneficial owner, directly or indirectly, of 10 percent or more of
the voting power of the then outstanding stock of the corporation:
(1) at any time within the two-year period
immediately prior to the date in question; and
(2) after the date on which the corporation had
100 or more beneficial owners of its stock.
(b) for the purpose of determining whether a person is an
Interested Stockholder, the number of shares of voting stock deemed to
be outstanding shall include shares deemed owned by the person through
application of Section A.3 of this Article but may not include any
other shares of voting stock which may be issuable pursuant to any
agreement, arrangement, or understanding, or upon exercise of
conversion rights, warrants or options, or otherwise.
9. The term "Market Value" means:
(a) in the case of stock, the highest closing sale price during the 30
day period immediately preceding the date in question of a share of such stock
on the composite tape for New York Stock Exchange listed stocks, or, if such
stock is not quoted on the composite tape, on the New York Stock Exchange, or if
such stock is not listed on such exchange, on the principal United States
securities exchange registered under the Securities Exchange Act of 1934 on
which such stock is listed, or, if such stock is not listed on any such
exchange, the highest closing bid quotation with respect to a share of such
stock during the 30 day period preceding the date in question on the National
Association of Securities Dealers, Inc. automated quotations system or any
system then in use, or, if no such quotations are available, the fair market
value on the date
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<PAGE>
in question of a share of such stock as determined by the board of directors of
the corporation in good faith; and
(b) in the case of property other than cash or stock, the fair market
value of such property on the date in question is determined by the board of
directors of the corporation in good faith.
10. The term "Subsidiary" means any corporation of which voting
stock having a majority of the votes entitled to be cast is
owned, directly or indirectly, by the corporation.
11. The term "Voting Stock" means shares of capital stock of a
corporation entitled to vote generally in the election of
directors.
B. General Requirement.
1. The Corporation may not engage in any Business Combination with any
Interested Stockholder or any Affiliate of the Interested Stockholder for a
period of five years following the most recent date on which the Interested
Stockholder became an Interested Stockholder unless a resolution of the board of
directors is adopted which exempts specifically or generally by types, existing
or future Interested Stockholders or their Affiliates at any time prior to the
Determination Date. Unless by its terms a resolution of the board is made
irrevocable, it may be altered or repealed by the board, but it shall not affect
any Business Combinations that have been consummated, or are the subject of an
existing agreement entered into, prior to alteration or repeal.
2. In addition to any vote otherwise required by law, a Business
Combination that is not prohibited by Section B.1 of this Article shall be
recommended by the board of directors and approved by the affirmative vote of at
least:
(a) 80 percent of the votes entitled to be cast by outstanding
shares of Voting Stock of the Corporation, voting together as a single
voting group; and
(b) two-thirds of the votes entitled to be cast by holders of
Voting Stock other than Voting Stock held by the Interested Stockholder
who will (or whose Affiliate will) be a party to the Business
Combination or by an Affiliate or Associate of the Interested
Stockholder, voting together as a single voting group.
C. When Voting Requirements Not Applicable.
The vote required by Section B.2 of this Article does not apply to a Business
Combination if:
(a) the board of directors adopts a resolution which exempts
the Business Combination with the Interested Stockholder or its
Affiliates, specifically or generally, at any time prior to the
Determination Date, or
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(b) the Business Combination meets the fair price requirements
of Maryland law in Section 3-603 of Title 6 of the General Laws of the
State of Maryland in effect on the date of filing these Articles, or as
the laws may be amended from time to time.
D. Additional Provisions. Nothing contained in this Article 14, shall
be construed to relieve an Interested Shareholder from any fiduciary obligation
imposed by law. In addition, nothing contained in this Article 14 shall prevent
any shareholder of the Company from objecting to any Business Combination and
from demanding any appraisal rights which may be available to such shareholder.
E. Amendments. Notwithstanding any provisions of these Articles of
Incorporation or the Bylaws of the Company (and notwithstanding the fact that a
lesser percentage may be specified by laws, these Articles of Incorporation or
the Bylaws of the Company), the affirmative vote of the holders of at least 80
percent of the outstanding shares entitled to vote thereon (and, if any class or
series is entitled to vote thereon separately, the affirmative vote of the
holders of at least 80 percent of the outstanding shares of each such class or
series) shall be required to amend or repeal this Article 14 or adopt any
provisions inconsistent with this Article.
Article 15. Evaluation of Offers. The Board of Directors of the
Company, when evaluating any offer to (A) make a tender or exchange offer for
any equity security of the Company, (B) merge or consolidate the Company with
another corporation or entity or (C) purchase or otherwise acquire all or
substantially all of the properties and assets of the Company, may, in
connection with the exercise of its judgment in determining what is in the best
interest of the Company and its stockholders, give due consideration to all
relevant factors, including, without limitation, the social and economic effect
of acceptance of such offer: on the Company's present and future customers and
employees and those of its subsidiaries; on the communities in which the Company
and its subsidiaries operate or are located; on the ability of the Company to
fulfill its corporate objectives as a financial institution holding company and
on the ability of its subsidiary financial institution to fulfill the objectives
of a federally insured financial institution under applicable statutes and
regulations.
Article 16. Stockholder Approval of Certain Transactions.
A. Stockholder Vote. Any merger, consolidation, liquidation, or
dissolution of the Company or any action that would result in the sale or other
disposition of all or substantially all of the assets of the Company shall
require the affirmative vote of the holders of at least eighty percent (80%) of
the outstanding shares of capital stock of the Company eligible to vote at a
legal meeting.
B. Board Approval. The provisions of Article 16.A shall not apply to a
particular transaction and such transaction shall require only such stockholder
vote, if any, as would be required by Maryland law, if such transaction is
approved by two-thirds of the entire Board of Directors of the Company.
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Article 17. Amendment of Articles and Bylaws.
A. Articles. The Company reserves the right to amend, alter, change, or
repeal any provision contained in these Articles of Incorporation, in the manner
now or hereafter prescribed by law, and all rights conferred upon stockholders
herein are granted subject to this reservation. No amendment, addition,
alteration, change, or repeal of these Articles of Incorporation shall be made
unless such amendment addition, alteration, change, or repeal is first proposed
and approved by the Board of Directors pursuant to a resolution proposed and
adopted by the affirmative vote of a majority of the directors then in office,
and thereafter is approved by the holders of a majority (except as provided
below) of the shares of the Company entitled to vote generally in an election of
directors, voting together as a single class, as well as such additional vote of
the Preferred Stock as may be required by the provisions of any series thereof.
Notwithstanding anything contained in these Articles of Incorporation to the
contrary, the affirmative vote of the holders of at least eighty percent (80%)
of the shares of the Company entitled to vote generally in an election of
directors, voting together as a single class, as well as such additional vote of
the Preferred Stock as may be required by the provisions of any series thereof,
shall be required to amend, adopt, alter, change, or repeal any provision
inconsistent with Articles 8, 9, 10, 11, 12, 13, 14, 15, 16 and 17. The Board of
Directors has the authority to amend the Articles without shareholder vote in
accordance with Section 2-605 of the MGCL.
B. Bylaws. The Board of Directors or stockholders may adopt, alter,
amend, or repeal the Bylaws of the Company. Such action by the Board of
Directors shall require the affirmative vote of a majority of the directors then
in office at any regular or special meeting of the Board of Directors. Such
action by the stockholders shall require the affirmative vote of the holders of
at least eighty percent (80%) of the shares of the Company entitled to vote
generally in an election of directors, voting together as a single class, as
well as such additional vote of the Preferred Stock as may be required by the
provisions of any series thereof.
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