RESTATED
ARTICLES OF INCORPORATION
OF GERMAN AMERICAN BANCORP
ARTICLE I
Name
The name of the Corporation is German American Bancorp.
ARTICLE II
Purposes and Powers
Section 1. Purposes of the Corporation. The purposes for which the
Corporation is formed are to transact any or all lawful business permitted by
applicable law and for which corporations may now or hereafter be incorporated
under the Corporation Law.
Section 2. Powers of the Corporation. The Corporation shall have (a) all
powers now or hereafter authorized by or vested in corporations pursuant to the
provisions of the Corporation Law, (b) all powers now or hereafter vested in
corporations by common law or any other statute or act, and (c) all powers
authorized by or vested in the corporation by the provisions of these Restated
Articles of Incorporation or by the provisions of its Bylaws as from time to
time in effect.
ARTICLE III
Term of Existence
The period during which the Corporation shall continue is perpetual.
Exhibit 3.1
ARTICLE IV
Registered Office and Agent
The street address of the Corporation's registered office at the time of
adoption of these Restated Articles of Incorporation is 711 Main Street, P.O.
Box 810, Jasper, Indiana 47546, and the name of its Resident Agent at such
office at the time of adoption of these Restated Articles of Incorporation is
George W. Astrike.
ARTICLE V
Shares
The total number of shares of capital stock the Corporation has authority
to issue shall be 5,500,000 shares consisting of 5,000,000 common shares (the
`Common Shares'') and 500,000 preferred shares (the ``Preferred Shares''). The
Corporation's shares shall have a par value of ten dollars ($10.00) per share.
ARTICLE VI
Terms of Shares
Section 1. General Terms of All Shares. The Corporation shall have the
power to acquire (by purchase, redemption, or otherwise), hold, own, pledge,
sell, transfer, assign, reissue, cancel, or otherwise dispose of the shares of
the Corporation in the manner and to the extent now or hereafter permitted by
the laws of the State of Indiana. The power to purchase, redeem, or otherwise
acquire the Corporation's own shares, directly or indirectly, may be exercised
without pro rata treatment of the owners or holders of any class or series of
shares. The Corporation may not purchase, redeem or otherwise acquire the
Corporation's own shares if, after giving effect thereto, the Corporation would
not be able to pay its debts as they become due in the usual course of business
or the Corporation's total assets would be less than its total liabilities
(without regard to any amounts that would be needed, if the Corporation were to
be dissolved at the time of the purchase, redemption, or other acquisition, to
satisfy the preferential rights upon dissolution of shareholders whose
preferential rights are superior to those of the holders of the shares of the
Corporation being purchased, redeemed, or otherwise acquired, unless otherwise
expressly provided with respect to a series of Preferred Shares in the
provisions of these Restated Articles of Incorporation adopted by the Board of
Directors pursuant to Section 3(a) of this Article VI describing the terms of
such series). Shares of the Corporation purchased, redeemed, or otherwise
acquired by it shall constitute authorized by unissued shares, unless the Board
of Directors shall at any time adopt a resolution providing that such shares
constitute authorized and issued but not outstanding shares.
The Board of Directors of the Corporation may dispose of, issue, and sell
shares in accordance with, and in such amounts as may be permitted by, the laws
of the State of Indiana and the provisions of these Restated Articles of
Incorporation and for such consideration, at such price or prices, at such time
or times and upon such terms and conditions (including the privilege of
selectively repurchasing the same) as the Board of Directors of the Corporation
shall determine, without the authorization or approval by any shareholders of
the Corporation. Shares may be disposed of, issued, and sold to such persons,
firms, or corporations as the Board of Directors may determine, without any
preemptive or other right on the part of the owners or holders of other shares
of the Corporation of any class or kind to acquire such shares by reason of
their ownership of such other shares.
The Corporation shall have the power to declare and pay dividends or other
distributions upon the issued and outstanding shares of the Corporation, subject
to the limitation that a dividend or other distribution may not be made if,
after giving it effect, the Corporation would not be able to pay its debts as
they become due in the usual course of business or the Corporation's total
assets would be less than its total liabilities (without regard to any amounts
that would be needed, if the Corporation were to be dissolved at the time of the
dividend or other distribution, to satisfy the preferential rights upon
dissolution of shareholders whose preferential rights are superior to those of
the holders of shares receiving the dividend or other distribution, unless
otherwise expressly provided with respect to a series of Preferred Shares in the
provisions of these Restated Articles of Incorporation adopted by the Board of
Directors pursuant to Section 3(a) of this Article VI describing the terms of
such series). The Corporation shall have the power to issue shares of one class
or series as a share dividend or other distribution in respect of that class or
series or one or more other classes or series, except as may be otherwise
provided with respect to a series of Preferred Shares in the provisions of these
Restated Articles of Incorporation adopted by the Board of Directors pursuant to
Section 3(a) of this Article VI describing the terms of such series.
Section 2. Terms of Common Shares. The Common Shares shall be equal in
every respect insofar as their relationship to the Corporation is concerned, but
such equality of rights shall not imply equality of treatment as to redemption
or other acquisition of shares by the Corporation. Subject to the rights of the
holders of any issued and outstanding Preferred Shares under this Article VI,
the holders of Common Shares shall be entitled to share ratably in such
dividends or other distributions (other than purchases, redemptions, or other
acquisitions of Common Shares of the Corporation), if any, as are declared and
paid from time to time on the Common Shares at the discretion of the Board of
Directors. In the event of any liquidation, dissolution, or winding up of the
Corporation, either voluntary or involuntary, after payment shall have been made
to the holders of the Preferred Shares of the full amount to which they shall be
entitled under this Article VI, the holders of Common Shares shall be entitled,
to the exclusion of the holders of the Preferred Shares of any and all series,
to share, ratably according to the number of Common Shares held by them, in all
remaining assets of the Corporation available for distribution to its
shareholders.
Section 3. Terms of Preferred Shares.
(a) Preferred Shares may be issued from time to time in one or more
series, each such series to have such distinctive designation and such
preferences, limitations, and relative voting and other rights as shall be set
forth in these Restated Articles of Incorporation. Subject to the requirements
of the Corporation Law and subject to all other provisions of these Restated
Articles of Incorporation, the Board of Directors of the Corporation may create
one or more series of Preferred Shares and may determine the preferences,
limitations, and relative voting and other rights of one or more series of
Preferred Shares before the issuance of any shares of that series by the
adoption of an amendment to these Restated Articles of Incorporation that
specifies the terms of that series of Preferred Shares. All shares of a series
of Preferred Shares must have preferences, limitations, and relative voting and
other rights identical to those of other shares of the same series. No series
of Preferred Shares need have preferences, limitations, or relative voting or
other rights identical with those of any other series of Preferred Shares.
Before issuing any shares of a series of Preferred Shares, the Board of
Directors shall adopt an amendment to these Restated Articles of Incorporation,
which shall be effective without any shareholder approval or other action, that
fixes and sets forth the distinctive designation of such series; the number of
shares that shall constitute such series, which number may be increased or
decreased (but not below the number of shares thereof then outstanding) from
time to time by action of the Board of Directors; and the preferences,
limitations, and relative voting and other rights of the series. Authority is
hereby expressly vested in the Board of Directors, by such amendment, to fix all
of the preferences or rights, and any qualifications, limitations, or
restrictions of such preferences or rights, of such series to the full extent
permitted by the Corporation Law; provided, however, that no such preferences,
rights, qualifications, limitations, or restrictions shall be in conflict with
these Restated Articles of Incorporation or any amendment hereof.
(b) Preferred Shares of any series that have been redeemed (whether
through the operation of a sinking fund or otherwise) or purchased by the
Corporation, or that, if convertible, have been converted into shares of the
Corporation of any other class or series, may be reissued as a part of such
series or of any other series of Preferred Shares, subject to such limitations
(if any) as may be fixed by the Board of Directors with respect to such series
of Preferred Shares in accordance with Section 3 (a) of this Article VI.
ARTICLE VII
Voting Rights
Section 1. Common Shares. Except as otherwise provided by the Corporation
Law or by the provisions of these Restated Articles of Incorporation adopted by
the Board of Directors pursuant to Section 3(a) of Article VI hereof describing
the Preferred Shares or a series thereof, and subject to such shareholder
disclosure and recognition procedures (which may include sanctions for
noncompliance therewith to the fullest extent permitted by the Corporation Law)
as the Corporation may by action of the Board of Directors establish, the Common
Shares have unlimited voting rights. At every meeting of the shareholders of
the Corporation every holder of Common Shares shall be entitled to one vote in
person or by proxy for each Common Share standing in such holder's name on the
share transfer records of the Corporation.
Section 2. Preferred Shares. Except as required by the Corporation Law or
by the provisions of these Restated Articles of Incorporation adopted by the
Board of Directors pursuant to Section 3(a) of Article VI hereof describing the
terms of Preferred Shares or a series thereof, the holders of Preferred Shares
shall have no voting rights or powers. Preferred Shares shall, when validly
issued by the Corporation, entitle the record holder thereof to vote on such
matters, but only on such matters, as the holders thereof are entitled to vote
under the Corporation Law or under these Restated Articles of Incorporation
adopted by the Board of Directors pursuant to Section 3(a) of Article VI hereof
describing the terms of Preferred Shares or a series thereof (which provisions
may provide for special, conditional, limited, or unlimited voting rights,
including multiple or fractional votes per share, or for no right to vote,
except to the extent required by the Corporation Law) and subject to such
shareholder disclosure and recognition procedures (which may include sanctions
for noncompliance therewith to the fullest extent permitted by the Corporation
Law) as the Corporation may by action of the Board of Directors establish.
ARTICLE VIII
Directors
Section 1. Number. The Board of Directors at the time of adoption of
these Restated Articles of Incorporation is composed of ten members. The number
of Directors shall be fixed by, or fixed in accordance with, the Bylaws.
Whenever there are nine or more Directors, the Bylaws may also provide for
staggering the terms of the members of the Board of Directors by dividing the
total number of Directors into two or three groups (with each group containing
one-half or one-third of the total, as near as may be) whose terms of office
expire at different times.
Section 2. Election of Directors by Holders of Preferred Shares. The
holders of one or more series of Preferred Shares may be entitled to elect all
or a specified number of Directors, but only to the extent and subject to
limitations as may be set forth in the provisions of these Restated Articles of
Incorporation adopted by the Board of Directors pursuant to Section 3(a) of
Article VI hereof describing the terms of the series of Preferred Shares.
Section 3. Vacancies. Vacancies occurring in the Board of Directors shall
be filled in the manner provided in the Bylaws or, if the Bylaws do not provide
for the filling of vacancies, in the manner provided by the Corporation Law.
Section 4. Removal of Directors. Any or all of the members of the Board
of Directors may be removed, with or without cause, at a meeting of the
shareholders called expressly for that purpose, by the affirmative vote of the
holders of at least 80 percent of the outstanding shares then entitled to vote
at an election of Directors. However, a Director elected by the holders of a
series of Preferred Shares as authorized by Section 2 of this Article VIII may
be removed only by the affirmative vote of the holders of at least 80 percent of
the outstanding shares of that series then entitled to vote at an election of
Directors. Directors may not be removed by the Board of Directors.
Section 5. Liability of Directors. A Director's responsibility to the
Corporation shall be limited to discharging his duties as a Director, including
his duties as a member of any committee of the Board of Directors upon which he
may serve, in good faith, with the care an ordinarily prudent person in a like
position would exercise under similar circumstances, and in a manner the
Director reasonably believes to be in the best interests of the Corporation, all
based on the facts then known to the Director.
In discharging his duties, a Director is entitled to rely on information,
opinions, reports or statements, including financial statements and other
financial data, if prepared or presented by:
(a) One or more officers or employees of the Corporation whom the
Director reasonably believes to be reliable and competent in the matters
presented;
(b) Legal counsel, public accountants, or other persons as to matters
the Director reasonably believes are within such person's professional or
expert competence; or
(c) A committee of the Board of which the Director is not a member if
the Director reasonably believes the committee merits confidence;
but a Director is not acting in good faith if the Director has knowledge
concerning the matter in question that makes reliance otherwise permitted by
this Section 5 unwarranted. A Director may, in considering the best interests
of the Corporation, consider the effects of any action on shareholders,
employees, suppliers, and customers of the Corporation, and communities in which
offices or other facilities of the Corporation are located, and any other
factors the Director considers pertinent.
Directors shall be immune from personal liability for any action taken as a
Director, or any failure to take any action, to the fullest extent permitted by
the applicable provisions of the Corporation Law from time to time in effect and
by general principles of corporate law.
ARTICLE IX
Provisions for Regulation of Business and Conduct of Affairs of Corporation
Section 1. Bylaws. The Board of Directors shall have the exclusive power
to make, alter, amend, or repeal, or to waive provisions of, the Bylaws of the
Corporation by the affirmative vote of a majority of the number of Directors
then in office, except as provided by the Corporation Law. All provisions for
the regulation of the business and management of the affairs of the Corporation
not stated in these Restated Articles of Incorporation shall be stated in the
Bylaws. The Board of Directors may also adopt Emergency Bylaws of the
Corporation and shall have the exclusive power (except as may otherwise be
provided therein) to make, alter, amend, or repeal, or to waive provisions of,
the Emergency Bylaws by the affirmative vote of a majority of the entire number
of Directors at the time.
Section 2. Amendment or Repeal. (a) Any amendment, change or repeal of
Section 4 of Article VIII, Section 2 or 3 of Article IX, or Article X of these
Restated Articles of Incorporation, or any other amendment of these Restated
Articles of Incorporation which would have the effect of modifying or permitting
circumvention of those provisions, shall require the affirmative vote, at a
meeting of shareholders of the Corporation, by the holders of a least 80 percent
of the outstanding shares of all classes of Voting Shares of the Corporation
(considered for purposes of this Section 2(a) as a single class and as defined
in Article X) and, if the amendment, change or repeal shall be proposed by or on
behalf of a Related Person (as that term is defined in Article X), by an
Independent Majority of Shareholders (as defined in Article X); provided,
however, that this Section 2(a) shall not apply to, and such vote shall not be
required for, any such amendment, change or repeal recommended to shareholders
by the favorable vote of not less than two-thirds of the Board of Directors and,
if the amendment, change or repeal shall be proposed by or on behalf of a
Related Person, by the favorable vote of not less than two-thirds of the
Continuing Directors (as defined in Article X and computed with reference to the
Related Person who shall propose such amendment, change or repeal), and any such
amendment, change or repeal so recommended shall require only the shareholder
vote required under the applicable provisions of the Corporation Law.
(b) Except as otherwise expressly provided in Section 2(a) above, the
Corporation shall be deemed, for all purposes, to have reserved the right to
amend, alter, change or repeal any provision contained in these Restated
Articles of Incorporation to the extent and in the manner now or hereafter
permitted or prescribed by statute, and all rights herein conferred upon
shareholders are granted subject to such reservation.
Section 3. Removal of Chairman of the Board and President. The Chairman
of the Board and the President, and each of them, may be removed from office at
any time, with or without cause, at a meeting of the Board of Directors called
expressly for that purpose, but only by the affirmative vote of two-thirds of
all other members of the entire Board of Directors, Any vacancy created by the
removal of the Chairman or the President may be filled only by the affirmative
vote of two-thirds of all remaining members of the Board.
ARTICLE X
Approval of Business Combinations
Section 1. Supermajority Vote. Except as provided in Sections 2 and 3 of
this Article X, neither the Corporation nor any of its Subsidiaries shall become
party to any Business Combination with a Related Person without the prior
affirmative vote at a meeting of the Corporation's shareholders:
(a) By the holders of not less than 80 percent of the outstanding
shares of all classes of Voting Shares of the Corporation considered for
purposes of this Article X as a single class, and
(b) By an Independent Majority of Shareholders.
Such favorable votes shall be in addition to any shareholder vote that
would be required without reference to this Section 1 and shall be required
notwithstanding the fact that no vote may be required, or that some lesser
percentage may be specified by law or in other Articles of these Restated
Articles of Incorporation or the Bylaws of the Corporation or otherwise.
Section 2. Reduced Supermajority Vote for Fair Pricing. The provisions of
Section 1 shall apply to a Business Combination, except that the percentage vote
required by Section 1 (a) shall be reduced from not less than 80 percent to not
less than two-thirds, if all of the conditions set forth in subsections (a)
through (d) of this Section 2 are satisfied.
(a) The fair market value of the property, securities or other
consideration to be received per share by holders of each class or series
of capital shares of the Corporation in the Business Combination is not
less, as of the date of the consummation of the Business Combination (the
`Consummation Date''), than the higher of the following: (i) the highest
per share price (with appropriate adjustments for recapitalizations and for
share splits, share dividends and like distributions) including brokerage
commissions and solicitation fees paid by the Related Person in acquiring any
of its holdings of such class or series of capital shares within the two-year
period immediately prior to the first public announcement of the proposed
Business Combination (`Announcement Date'') or in the transaction in which it
became a Related Person, whichever is higher, plus interest compounded
annually, from the later of the date that the Related Person became a Related
Person (the `Determination Date''), or the date two years before the
Consummation Date, through the Consummation Date, at the rate publicly
announced as the `prime rate'' of interest of Citibank, N.A. (or of such other
major bank headquartered in New York as may be selected by a majority of the
Continuing Directors) from time to time in effect, less the aggregate amount
of any cash dividends paid and the fair market value of any dividends
paid in other than cash on each such share from the date from which interest
accrues under the preceding clause through the Consummation Date up to but
not exceeding the amount of interest so payable per share; OR (ii) if such
class or series is then traded on an exchange or is the subject of regularly
published quotations from three or more broker/dealers who make a market in
such class or series for their own accounts, the fair market value per share
of such class or series on the Announcement Date, as determined by the highest
closing sales price on such exchange or the highest closing bid quotation
with respect to such shares during the 30-day period immediately preceding
the Announcement Date. In the event of a Business Combination upon
consummation of which the Corporation would be the surviving corporation or
company or would continue to exist (unless it is provided, contemplated or
intended that as part of such Business Combination or within one year after
consummation thereof a plan of liquidation or dissolution of the Corporation
will be effected), the term `other consideration to be received''shall
include (without limitation) Common Shares and/or the shares of any other
class of shares retained by shareholders of the Corporation other than
Related Persons who are parties to such Business Combination;
(b) The consideration to be received in such Business Combination by
holders of each class or series of capital shares other than the Related
Person involved shall, except to the extent that a shareholder agrees
otherwise as to all or part of the shares which he or she owns, be in the
same form and of the same kind as the consideration paid by the Related
Person in acquiring the majority of the capital shares of such class or series
already Beneficially Owned by it within the two-year period ending on the
Determination Date;
(c) After such Related Person became a Related Person and prior to
the consummation of such Business Combination: (i) such Related Person shall
have taken steps to insure that the Board of Directors of the Corporation
included at all times representation by Continuing Directors proportionate to
the ratio that the number of Voting Shares of the Corporation from time to time
not Beneficially Owned by the Related Person bears to all Voting Shares of
the Corporation outstanding at the time in question (with a Continuing
Director to occupy any resulting fractional position among the Directors); (ii)
such Related Person shall not have acquired from the Corporation, directly or
indirectly, any shares of the Corporation (except upon conversion of
convertible securities acquired by it prior to becoming a Related Person or
as a result of a pro rata share dividend, share split or division of shares
or in a transaction that satisfied all applicable requirements of this
Article X); (iii) such Related Person shall not have acquired any additional
Voting Shares of the Corporation or securities convertible into or exchangeable
for Voting Shares except as a part of the transaction which resulted in such
Related Person's becoming a Related Person; and (iv) such Related Person
shall not have received the benefit, directly or indirectly (except
proportionately as a shareholder), of any loans, advances, guarantees,
pledges or other financial assistance or tax credits provided by the
Corporation or any Subsidiary, or made any major change in the Corporation's
business or equity capital structure or entered into any contract, arrangement
or understanding with the Corporation except any such change, contract,
arrangement or understanding as may have been approved by the favorable vote of
not less than a majority of the Continuing Directors of the Corporation; and
(d) A proxy statement complying with the requirements of the
Securities Exchange Act of 1934 and the rules and regulations of the Securities
and Exchange Commission thereunder, as then in force for corporations subject to
the requirements of Section 14 of such Act (even if the Corporation is not
otherwise subject to Section 14 of such Act), shall have been mailed to all
holders of Voting Shares for the purpose of soliciting shareholder approval of
such Business Combination. Such proxy statement shall contain on the face page
thereof, in a prominent place, any recommendations as to the advisability (or
inadvisability) of the Business Combination which the Continuing Directors, or
any of them, may have furnished in writing and, if deemed advisable by a
majority of the Continuing Directors, a fair summary of an opinion of a
reputable investment banking firm addressed to the Corporation as to the
fairness (or lack of fairness) of the terms of such Business Combination from
the point of view of the holders of Voting Shares other than any Related Person
(such investment banking firm to be selected by a majority of the Continuing
Directors, to be furnished with all information it reasonably requests, and to
be paid a reasonable fee for its services upon receipt by the Corporation of
such opinion).
Section 3. Director Approval Exception. The provisions of Sections 1 and
2 of this Article X shall not apply to, and such votes shall not be required,
if:
(a) The Continuing Directors of the Corporation by a two-thirds vote
(i) have expressly approved a memorandum of understanding with the Related
Person with respect to the Business Combination prior to the time the Related
Person became a Related Person, or (ii) have otherwise approved the Business
Combination (this provision is incapable of satisfaction unless there is at
least one Continuing Director); or
(b) The Business Combination is solely between the Corporation and
another corporation, 100 percent of the Voting Shares of which are owned
directly or indirectly by the Corporation.
Section 4. Definitions. For the purpose of this Article X:
(a) A `Business Combination'' means:
(i) the sale, exchange, lease, transfer or other disposition to
or with a Related Person or any Affiliate or Associate of such Related Person by
the Corporation or any of its Subsidiaries (in a single transaction or a Series
of Related Transactions) of all or substantially all, or any Substantial Part,
of its or their assets or businesses (including, without limitation, any
securities issued by a Subsidiary);
(ii) The purchase, exchange, lease or other acquisition by the
Corporation or any of its Subsidiaries (in a single transaction or a Series of
Related Transactions) of all or substantially all, or any Substantial Part, of
the assets or business of a Related Person or any Affiliate or Associate of such
Related Person;
(iii) Any merger or consolidation of the Corporation or any
Subsidiary thereof into or with a Related Person or any Affiliate or Associate
of such Related Person or into or with another Person which, after such merger
or consolidation, would be an Affiliate or an Associate of a Related Person, in
each case irrespective of which Person is the surviving entity in such merger or
consolidation;
(iv) Any reclassification of securities, recapitalization or
other transaction (other than a redemption in accordance with the terms of the
security redeemed) which has the effect, directly or indirectly, of increasing
the proportionate amount of Voting Shares of the Corporation or any Subsidiary
thereof which are Beneficially Owned by a Related Person, or any partial or
complete liquidation, spinoff, splitoff or splitup of the Corporation or any
Subsidiary thereof; provided, however, that this Section 4(a)(iv) shall not
relate to any transaction of the types specified in this Article X that has been
approved by a majority of the Continuing Directors; or
(v) The acquisition upon the issuance thereof of Beneficial
Ownership by a Related Person of Voting Shares or securities convertible into
Voting Shares or any voting securities or securities convertible into voting
securities of any Subsidiary of the Corporation, or the acquisition upon the
issuance thereof of Beneficial Ownership by a Related Person of any rights,
warrants or options to acquire any of the foregoing or any combination of the
foregoing Voting Shares or voting securities of the Subsidiary.
(b) A `Series of Related Transactions'' shall be deemed to include
not only a series of transactions with the same Related Person but also a series
of separate transactions with a Related Person or any Affiliate or Associate of
such Related Person.
(c) A `Person'' shall mean any individual, firm, corporation or
other entity and any partnership, syndicate or other group.
(d) `Related Person'' shall mean any Person (other than the
Corporation or any of the Corporation's Subsidiaries) who or that:
(i) is the Beneficial Owner, directly or indirectly, of more
than ten percent of the voting power of the outstanding Voting Shares;
(ii) is an Affiliate of the Corporation and at any time within
the two-year period immediately prior to the date in question was the Beneficial
Owner, directly or indirectly, of ten percent or more of the voting power of the
then outstanding shares of Voting Shares; or
(iii) is an assignee of or has otherwise succeeded to any Voting
Shares which were at any time within the two-year period immediately prior to
the date in question beneficially owned by any Related Person, if such
assignment or succession shall have occurred in the course of a transaction or
series of transactions not involving a public offering within the meaning of the
Securities Act of 1933.
A Related Person shall be deemed to have acquired a share of the
Corporation at the time when such Related Person became the Beneficial Owner
thereof. For the purposes of determining whether a Person is the Beneficial
Owner of ten percent or more of the voting power of the then outstanding Voting
Shares, the outstanding Voting Shares shall be deemed to include any Voting
Shares that may be issuable to such Person pursuant to a right to acquire such
Voting Shares and that is therefore deemed to be Beneficially Owned by such
Person pursuant to Section 4(e)(ii)(a). A Person who is a Related Person at
(i) the time any definitive agreement relating to a Business Combination is
entered into, (ii) the record date for the determination of shareholders
entitled to notice of and to vote on a Business Combination, or (iii) the time
immediately prior to the consummation of a Business Combination, shall be deemed
a Related Person.
(e) A Person shall be a `Beneficial Owner'' of any Voting Shares:
(i) which such Person or any of its Affiliates or Associates
beneficially owns, directly or indirectly; or
(ii) which such Person or any of its Affiliates or Associates
has (a) the right to acquire (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 (b) the right to vote pursuant to any
agreement, arrangement or understanding; or
(iii) which are beneficially owned, directly or indirectly, by
any other Person with which such Person or any of its Affiliates or Associates
has any agreement, arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of any Voting Shares.
(f) An `Affiliate'' of, or a person Affiliated with, a specific
Person, means a Person that directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with,
the Person specified.
(g) The term `Associate'' used to indicate a relationship with any
Person, means (i) any corporation or organization (other than this Corporation
or a majority-owned Subsidiary of this Corporation) of which such Person is an
officer or partner or is, directly or indirectly, the Beneficial Owner of five
percent or more of any class of equity securities, (ii) any trust or other
estate in which such Person has a substantial beneficial nterest or as to which
such Person serves as trustee or in a similar fiduciary capacity, (iii) any
relative or spouse of such Person, or any relative of such spouse, who has the
same home as such Person, or (iv) any investment company registered under the
Investment Company Act of 1940, for which such Person or any Affiliate of such
Person serves as investment advisor.
(h) `Subsidiary'' means any corporation of which a majority of any
class of equity security is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Related Person set
forth in paragraph (d) of this Section 4, the term `Subsidiary'' shall mean
only a corporation of which a majority of each class of equity security is
owned, directly or indirectly, by the Corporation.
(i) `Continuing Director'' means any member of the Board of
Directors of the Corporation (the `Board''), other than the Related Person who
proposes the Business Combination in question and his Affiliates and Associates,
who (i) is a member of the Board at the time this Article X first became
effective or (ii) was a member of the Board prior to the time that the Related
Person who proposes the Business Combination in question became a Related Person
or (iii) is a successor of a Continuing Director who was recommended to succeed
the Continuing Director by a majority of Continuing Directors then on the Board.
(j) `Independent Majority of Shareholders'' shall mean the holders
of a majority of the outstanding Voting Shares that are not Beneficially Owned
or controlled, directly or indirectly, by the Related Person who proposes the
Business Combination in question.
(k) `Voting Shares'' shall mean all outstanding capital shares of
the Corporation or another corporation entitled to vote generally in the
election of Directors, and each reference to a proportion of shares of Voting
Shares shall refer to such proportion of the votes entitled to be cast by such
shares.
(l) `Substantial Part'' means properties and assets involved in any
single transaction or a Series of Related Transactions having an aggregate fair
market value of more than ten percent of the total consolidated assets of the
Person in question as determined immediately prior to such transaction or Series
of Related Transactions.
Section 5. Director Determinations. A majority of the Continuing
Directors shall have the power to determine for the purposes of this Article X,
on the bases of information known to them: (i) the number of Voting Shares of
which any Person is the Beneficial Owner, (ii) whether a Person is an Affiliate
or Associate 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 Owner,'' (iv) whether the assets subject to any Business
Combination constitute a Substantial Part, (v) whether two or more transactions
constitute a Series of Related Transactions, and (vi) such other matters with
respect to which a determination is required under this Article X.
In connection with the exercise of its judgment in determining what is in
the best interests of the Corporation and its shareholders when evaluating a
business combination or a proposal by another Person or Persons to make a
business combination or a tender or exchange offer (regardless of whether such
proposal is otherwise subject to this Article X), the Board of Directors of the
Corporation shall, in addition to considering the adequacy of the consideration
to be paid in connection with any such transaction, consider all of the
following factors and any other factors that it deems relevant: (i) the social
and economic effects of the transaction on the Corporation and its Subsidiaries,
employees, depositors, loan and other customers, creditors and other elements of
the communities in which the Corporation and its Subsidiaries operate or are
located; (ii) the business and financial condition and earnings prospects of
the acquiring Person or Persons, including, but not limited to, debt service and
other existing or likely financial obligations of the acquiring Person or
Persons and their Affiliates and Associates, and the possible effect of such
conditions upon the Corporation and its Subsidiaries and the other elements of
the communities in which the Corporation and its Subsidiaries operate or are
located; and (iii) the competence, experience, and integrity of the acquiring
Person or Persons and its or their management and Affiliates and Associates.
Section 6. Fiduciary Obligations Unaffected. Nothing in this Article X
shall be construed to relieve any Related Person from any fiduciary duty imposed
by law.