CERTIFICATE OF INCORPORATION
OF
AMERICAN BANCORP OF NEW JERSEY, INC.
ARTICLE I
Name
----
The name of the corporation is American Bancorp of New Jersey, Inc.
(herein the "Corporation").
ARTICLE II
Registered Office
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The address of the Corporation's registered office in the State of New
Jersey is 365 Broad Street, Bloomfield, New Jersey 07003 in the County of Essex.
The name of the Corporation's registered agent at such address is Richard M.
Bzdek.
ARTICLE III
Powers
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The purpose of the Corporation is to engage in any activity within the
purposes for which corporations may be organized under 14A:2-7 of the New Jersey
Business Corporation Act.
ARTICLE IV
Term
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The Corporation is to have perpetual existence.
ARTICLE V
Incorporator
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The name and mailing address of the Incorporator is as follows:
Name Mailing Address
---- ---------------
Joseph Kliminski 365 Broad Street
Bloomfield, New Jersey 07003
ARTICLE VI
Initial Directors
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The number of directors constituting the initial board of directors of
the Corporation is eight (8) and the names and addresses of the persons who are
to serve as directors until their successors are elected and qualified, are:
Name Mailing Address
---- ---------------
Robert A. Gaccione 365 Broad Street
Bloomfield, New Jersey 07003
Joseph Kliminski 365 Broad Street
Bloomfield, New Jersey 07003
Fred G. Kowal 365 Broad Street
Bloomfield, New Jersey 07003
H. Joseph North 365 Broad Street
Bloomfield, New Jersey 07003
Stanley Obal 365 Broad Street
Bloomfield, New Jersey 07003
W. George Parker 365 Broad Street
Bloomfield, New Jersey 07003
Vincent S. Rospond 365 Broad Street
Bloomfield, New Jersey 07003
James H. Ward, III 365 Broad Street
Bloomfield, New Jersey 07003
ARTICLE VII
Capital Stock
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The aggregate number of shares of all classes of capital stock which
the Corporation has authority to issue is 30,000,000, of which 20,000,000 are to
be shares of common stock, $.10 par value per share, and of which 10,000,000 are
to be shares of serial preferred stock, $.10 par value per share. The shares may
be issued by the Corporation without the approval of stockholders except as
otherwise provided in this Article VII or the rules of a national securities
exchange, if applicable. The consideration for the issuance of the shares shall
be paid to or received by the Corporation in full before their issuance and
shall not be less than the par value per share. The consideration for the
issuance of the shares shall be cash, services rendered, personal property
(tangible or intangible), real property, leases of real property or any
combination of the foregoing. In the absence of actual fraud in the transaction,
the judgment of the board of directors as to the value of such consideration
shall be conclusive. Upon payment of such consideration, such shares shall be
deemed to be fully paid and nonassessable. In the case of a stock dividend, the
part of the surplus of the Corporation which is transferred to stated capital
upon the issuance of shares as a stock dividend shall be deemed to be the
consideration for their issuance.
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A description of the different classes and series (if any) of the
Corporation's capital stock, and a statement of the relative powers,
designations, preferences and rights of the shares of each class and series (if
any) of capital stock, and the qualifications, limitations or restrictions
thereof, are as follows:
A. Common Stock. Except as provided in this Certificate, the holders of
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the common stock shall exclusively possess all voting power. Each holder of
shares of common stock shall be entitled to one vote for each share held by such
holders.
Whenever there shall have been paid, or declared and set aside for
payment, to the holders of the outstanding shares of any class of stock having
preference over the common stock as to the payment of dividends, the full amount
of dividends and sinking fund or retirement fund or other retirement payments,
if any, to which such holders are respectively entitled in preference to the
common stock, then dividends may be paid on the common stock, and on any class
or series of stock entitled to participate therewith as to dividends, out of any
assets legally available for the payment of dividends, but only when as declared
by the board of directors of the Corporation.
In the event of any liquidation, dissolution or winding up of the
Corporation, after there shall have been paid, or declared and set aside for
payment, to the holders of the outstanding shares of any class having preference
over the common stock, the full preferential amounts to which they are
respectively entitled, the holders of the common stock and of any class or
series of stock entitled to participate therewith, in whole or in part, as to
distribution of assets shall be entitled, after payment or provision for payment
of all debts and liabilities of the Corporation, to receive the remaining assets
of the Corporation available for distribution, in cash or in kind.
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.
B. Serial Preferred Stock. Except as provided in this Certificate, the
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board of directors of the Corporation is authorized, by resolution or
resolutions from time to time adopted, to provide for the issuance of serial
preferred stock in series and to fix and state the powers, designations,
preferences and relative, participating, optional or other special rights of the
shares of such series, and the qualifications, limitations or restrictions
thereof, including, but not limited to determination of any of the following:
(1) the distinctive serial designation and the number of shares
constituting such series;
(2) the dividend rates or the amount of dividends to be paid on
the shares of such series, whether dividends shall be
cumulative and, if so, from which date or dates, the payment
date or dates for dividends, and the participating or other
special rights, if any, with respect to dividends;
(3) the voting powers, full or limited, if any, of the shares of
such series;
(4) whether the shares of such series shall be redeemable and, if
so, the price or prices at which, and the terms and conditions
upon which, such shares may be redeemed;
(5) the amount or amounts payable upon the shares of such series
in the event of voluntary or involuntary liquidation,
dissolution or winding up of the Corporation;
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(6) whether the shares of such series shall be entitled to the
benefits of a sinking or retirement fund to be applied to the
purchase or redemption of such shares, and, if so entitled,
the amount of such fund and the manner of its application,
including the price or prices at which such shares may be
redeemed or purchased through the application of such funds;
(7) whether the shares of such series shall be convertible into,
or exchangeable for, shares of any other class or classes or
any other series of the same or any other class or classes of
stock of the Corporation and, if so convertible or
exchangeable, the conversion price or prices, or the rate or
rates of exchange, and the adjustments thereof, if any, at
which such conversion or exchange may be made, and any other
terms and conditions of such conversion or exchange;
(8) the subscription or purchase price and form of consideration
for which the shares of such series shall be issued; and
(9) whether the shares of such series which are redeemed or
converted shall have the status of authorized but unissued
shares of serial preferred stock and whether such shares may
be reissued as shares of the same or any other series of
serial preferred stock.
Each share of each series of serial preferred stock shall have the same
relative powers, preferences and rights as, and shall be identical in all
respects with, all the other shares of the Corporation of the same series.
ARTICLE VIII
Preemptive Rights
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No holder of any of the shares of any class or series of capital stock
or of options, warrants or other rights to purchase shares of any class or
series of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any class or
series, or any unissued bonds, certificates of indebtedness, debentures of 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; but any such
unissued stock, bonds, certificates or 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 of
the Corporation 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 IX
Repurchase of Shares
--------------------
The Corporation may from time to time, pursuant to authorization by the
board of directors of the Corporation and without action by the stockholders,
purchase or otherwise acquire shares of capital stock of any class, bonds,
debentures, notes, script, warrants, obligations, evidences of indebtedness, or
other securities of the Corporation 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 Corporation outstanding at the time of the purchase
or acquisition or as are imposed by law or regulation.
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ARTICLE X
Meetings of Stockholders; Cumulative Voting; Proxies
----------------------------------------------------
A. Notwithstanding any other provision of this Certificate or the
Bylaws of the Corporation, any action required to be taken or which may be taken
at any annual or special meeting of stockholders of the Corporation may be taken
without a meeting, if all stockholders entitled to vote thereon consent thereto
in writing. The power of stockholders to take action by non-unanimous consent is
specifically denied. In the case of a merger, consolidation, acquisition of all
capital shares of the Corporation or sale of assets, such action may be taken
without a meeting only if all stockholders consent in writing, or if all
stockholders entitled to vote consent in writing and all other stockholders are
provided the advance notification required by Section 14A:5-6(2)(b) of the New
Jersey Business Corporation Act.
B. Special meetings of the stockholders of the Corporation for any
purpose or purposes may be called at any time by the Chairman of the Board of
the Corporation, the President of the Corporation, 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, but no other person or persons may call a special meeting of the
stockholders except as provided by the New Jersey Business Corporation Act.
C. 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 or her by proxy, but no such
proxy shall be voted or acted upon after eleven months from its date, unless the
proxy provides for a longer period. To be valid, a proxy must be executed and
authorized as required or permitted by law. Without limiting the manner in which
a stockholder may authorize another person or persons to act for him or her 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 or her 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, by facsimile
signature.
2. A stockholder may authorize another person or persons to act
for him or her as proxy by transmitting or authorizing the
transmission of a facsimile telecommunication, telegram,
cablegram, or other means of electronic transmission to the
person who will be the holder of the proxy or to a proxy
solicitation firm, proxy support service organization or
like agent duly authorized by the person who will be the
holder of the proxy to receive such transmission, provided
that any such facsimile telecommunication, telegram,
cablegram or other means of electronic transmission, must
either set forth or be submitted with information from which
it can be determined that the facsimile telecommunication,
telegram, cablegram or other electronic transmission was
authorized by the stockholder. If it is determined that such
facsimile telecommunications, telegrams, cablegrams or other
electronic transmission are valid, the inspectors or, if
there are no inspectors, such other persons making that
determination shall specify the information upon which they
relied.
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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 or all purposes for
which the original writing or transmission could be used,
provided that such copy, facsimile telecommunication or other
reproduction shall be a complete reproduction of the entire
original writing or transmission.
D. There shall be no cumulative voting by stockholders of any class or
series in the election of directors of the Corporation.
E. Meetings of stockholders may be held within or outside the State of
New Jersey, as the Bylaws may provide.
F. The presence, in person or by proxy, of the holders of a majority of
the outstanding shares of voting stock shall constitute a quorum at a meeting of
stockholders.
ARTICLE XI
Notice for Nominations and Proposals
------------------------------------
Advance notice of stockholder nominations for the election of directors
and of business to be brought by stockholders before any meeting of the
stockholders of the Corporation shall be given in the manner provided in the
Bylaws of the Corporation.
ARTICLE XII
Directors
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A. Number; Vacancies. The number of directors of the Corporation shall
------------------
be such number as shall be provided from time to time in or in accordance with
the Bylaws, provided that a decrease in the number of directors shall not 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 two-thirds of the directors then in
office shall concur in said action. Vacancies in the board of directors of the
Corporation, however caused, and newly-created directorships shall be filled by
a vote of a majority of the directors then in office, whether or not a quorum,
or by a sole remaining director, and any director so chosen shall hold office
for a term expiring at the next annual meeting of stockholders.
B. Classified Board. The board of directors of the Corporation shall be
----------------
divided into four classes of directors, which shall be designated Class I, Class
II, Class III and Class IV. The members of each class shall be elected for a
term of four 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 terms of
office of all members of one class expiring each year. At the first annual
meeting of stockholders, directors in Class I shall be elected to hold office
for a term expiring at the fourth succeeding annual meeting thereafter,
directors of Class II shall be elected to hold office for a term expiring at the
third succeeding meeting thereafter, directors of Class III shall be elected to
hold office for a term expiring at the second succeeding annual meeting
thereafter, and directors of Class IV shall be elected to hold office for a term
expiring at the first succeeding annual meeting thereafter. Directors whose term
shall expire at any annual meeting shall continue to serve until such time as
his or her successor shall have been duly elected and shall have qualified
unless his or her position on the board of directors shall have been abolished
by action taken to reduce the size of the board of directors prior to said
meeting.
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If the number of directors of the Corporation is reduced, the
directorship(s) eliminated shall be allocated among classes as appropriate 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. Notwithstanding the foregoing, no
decrease in the number of directors shall have the effect of shortening the term
of any incumbent director. If the number of directors of the Corporation is
increased, the additional directorships shall be allocated among classes as
appropriate so that the number of directors in each class is as specified in the
immediately preceding paragraph.
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 board of directors shall consist of
said directors so elected in addition to the number of directors fixed as
provided above in this Article XII. 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 Corporation shall have the right, voting separately as
a class, to elect one or more directors of the Corporation, the terms of the
director or directors elected by such holders shall expire at the next
succeeding annual meeting of stockholders.
ARTICLE XIII
Removal of Directors
--------------------
Notwithstanding any other provision of this Certificate or the Bylaws
of the Corporation, any director or the entire board of directors of the
Corporation may be removed for cause, at any time, by the affirmative vote of
the holders 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. In addition, the board of directors shall have the power to remove
directors for cause and to suspend directors pending a final determination that
cause exists for removal.
ARTICLE XIV
Certain Limitations on Voting Rights
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A. Limitations. Notwithstanding any other provision of this Certificate
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of Incorporation, 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 owning shares in excess of the
Limit.
Further, for a period of five years from the completion of the
conversion of American Savings, MHC 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 Corporation.
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B. Exclusions. The provisions of the foregoing Section A of this
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Article XIV shall not apply to:
(1) the acquisition of more than 10% of any class of equity
security by any tax-qualified defined benefit plan or defined
contribution plan of the Corporation or its subsidiaries;
(2) the purchase of shares by underwriters in connection with a
public offering; or
(3) the Offer to acquire or the acquisition of more than 10% of
any class of equity security of the Corporation if such Offer
to acquire or acquisition has been approved by two-thirds of
those members of the Board of Directors who were directors
prior to the Offer to acquire or acquisition.
C. Definitions. The following definitions shall apply to this Article
-----------
XIV.
1. "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 of Incorporation; 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 (as defined
in Article XV) beneficially owns, directly or
indirectly;
(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 XV) solely by
reason of an agreement, contract, or other arrangement
with this Corporation to effect any transaction which
is described in any one or more of sections of Article
XV) 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 Beneficially 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 Corporation;
and provided further, however, that (1) no director or officer of this
Corporation (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
8
by any other such director or officer (or any affiliate thereof), and (2)
neither any employee stock ownership or similar plan of this Corporation or any
subsidiary of this Corporation, 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 that may be issuable by
this Corporation 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 Corporation
pursuant to any agreement, or upon the exercise of conversion rights, warrants
or options, or otherwise.
2. 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 Corporation 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 Corporation 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.
3. "Person" shall mean any individual, firm, corporation, or
other entity.
D. Board Determinations. The Board of Directors shall have the power to
--------------------
construe and apply the provisions of this Article XIV 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 Article XIV to the given facts, or (v) any other matter relating to the
applicability or effect of this Article XIV. Any constructions, applications, or
determinations made by the directors pursuant to this Article XIV 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 Corporation
and its stockholders.
E. Demand for Information; Investigation. 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) ("Holder
in Excess") supply the Corporation 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 XIV as
may reasonably be requested of such person. The Board of Directors shall further
have the right to receive from any Holder in Excess reimbursement for all
expenses incurred by the Board in connection with its investigation of any
matters relating to the applicability or effect of this section on such Holder
in Excess, to the extent such investigation is deemed appropriate by the Board
of Directors as a result of the Holder in Excess refusing to supply the
Corporation with the information described in the previous sentence.
F. Quorum Requirements. Except as otherwise provided by law or
--------------------
expressly provided in this Article XIV, the presence in person or by proxy, of
the holders of record of shares of capital stock of the
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Corporation entitling the holders thereof to cast a majority of the votes (after
giving effect, if required, to the provisions of this Article XIV) entitled to
be cast by the holders of shares of capital stock of the Corporation entitled to
vote shall constitute a quorum at all meetings of the stockholders, and every
reference in this Certificate of Incorporation 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.
G. Enforceability. In the event any provision (or portion thereof) of
--------------
this Article XIV shall be found to be invalid, prohibited or unenforceable for
any reason, the remaining provisions (or portions thereof) of this Article XIV
shall remain in full force and effect, and shall be construed as if such
invalid, prohibited or unenforceable provision had been stricken here from or
otherwise rendered inapplicable, it being the intent of this Corporation and its
stockholders that each such remaining provision (or portion thereof) of this
Article XIV 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.
ARTICLE XV
Approval of Business Combinations
---------------------------------
A. Definitions and Related Matters. For the purposes of this Article XV
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and as otherwise expressly referenced hereto in this Certificate of
Incorporation:
1. "Affiliate" shall have the meaning ascribed to it in Rule 12b-2 of
the General Rules and Regulations under the Exchange Act, as in effect on the
date of filing of this Certificate.
2. "Announcement date" when used in reference to any Business
Combination, means the date of the first public announcement of the final,
definitive proposal for that Business Combination.
3. "Associate" when used to indicate a relationship with any person,
means (1) any corporation or organization of which that person is an officer or
partner or is, directly or indirectly, the Beneficial Owner of 10% or more of
any class of Voting Shares, (2) any trust or other estate in which that person
has a substantial beneficial interest or as to which that person serves as
trustee or in a similar fiduciary capacity, or (3) any relative or spouse of
that person, or any relative of that spouse, who has the same home as that
person.
4. "Beneficial Owner," when used with respect to any stock, means a
person:
(1) that, individually or with or through any of its
affiliates or associates, beneficially owns that stock, directly or indirectly;
(2) that, individually or with or through any of its
affiliates or associates, has (a) the right to acquire that stock (whether that
right is exercisable immediately or only after the passage of time), pursuant to
any agreement, arrangement or understanding (whether or not in writing), or upon
the exercise of conversion rights, exchange rights, warrants or options, or
otherwise; provided, however, that a person shall not be deemed the Beneficial
Owner of stock tendered pursuant to a tender or exchange offer made by that
person or any of that person's affiliates or associates until that tendered
stock is accepted for purchase or exchange; or (b) the right to vote that stock
pursuant to any agreement, arrangement or understanding
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(whether or not in writing); provided, however, that a person shall not be
deemed the Beneficial Owner of any stock under this subparagraph if the
agreement, arrangement or understanding to vote that stock (i) arises solely
from a revocable proxy or consent given in response to a proxy or consent
solicitation made in accordance with the applicable rules and regulations under
the Exchange Act, and (ii) is not then reportable on a Schedule 13D under the
Exchange Act (or any comparable or successor report); or
(3) that has any agreement, arrangement or understanding
(whether or not in writing), for the purpose of acquiring, holding, voting
(except voting pursuant to a revocable proxy or consent as described in
subparagraph (b) of paragraph (2) of this subsection, or disposing of that stock
with any other person that beneficially owns, or whose affiliates or associates
beneficially own, directly or indirectly, that stock.
5. "Business Combination" when used in reference to the Corporation and
any Interested Stockholder of the Corporation, means:
(1) any merger or consolidation of the Corporation or any
subsidiary of the Corporation with (a) that Interested Stockholder or (b) any
other corporation (whether or not it is an Interested Stockholder of the
Corporation) which is, or after a merger or consolidation would be, an affiliate
or associate of that Interested Stockholder;
(2) any sale, lease, exchange, mortgage, pledge, transfer or
other disposition (in one transaction or a series of transactions) to or with
that Interested Stockholder or any affiliate or associate of that Interested
Stockholder of assets of the Corporation or any subsidiary of the Corporation
(a) having an aggregate market value equal to 10% or more of the aggregate
market value of all the assets, determined on a consolidated basis, of the
Corporation, (b) having an aggregate market value equal to 10% or more of the
aggregate market value of all the outstanding stock of the Corporation, or (c)
representing 10% or more of the earnings power or income, determined on a
consolidated basis, of the Corporation;
(3) the issuance or transfer by the Corporation or any
subsidiary of the Corporation (in one transaction or a series of transactions)
of any stock of the corporation or any subsidiary of the Corporation which has
an aggregate market value equal to 5% or more of the aggregate market value of
all the outstanding stock of the Corporation to that Interested Stockholder or
any affiliate or associate of that Interested Stockholder, except pursuant to
the exercise of warrants or rights to purchase stock offered, or a dividend or
distribution paid or made, pro rata to all stockholders of the Corporation;
(4) the adoption of any plan or proposal for the liquidation
or dissolution of the Corporation proposed by, on behalf of or pursuant to any
agreement, arrangement or understanding (whether or not in writing) with that
Interested Stockholder or any affiliate or associate of that Interested
Stockholder;
(5) any reclassification of securities (including, without
limitation, any stock split, stock dividend, or other distribution of stock in
respect of stock, or any reverse stock split), or recapitalization of the
corporation, or any merger or consolidation of the Corporation with any
subsidiary of the Corporation, or any other transaction (whether or not with, or
into, or otherwise involving that Interested Stockholder), proposed by, on
behalf of or pursuant to any agreement, arrangement or understanding (whether or
not in writing) with that Interested Stockholder or any affiliate or associate
of that Interested Stockholder, which has the effect, directly or indirectly, of
increasing the proportionate share of the outstanding shares of any class or
series of stock or securities convertible into Voting Shares of the Corporation
or any subsidiary of the Corporation which is directly or indirectly owned by
that Interested Stockholder or any affiliate or
11
associate of that Interested Stockholder, except as a result of immaterial
changes due to fractional share adjustments; or
(6) any receipt by that Interested Stockholder or any
affiliate or associate of that Interested Stockholder of the benefit, directly
or indirectly (except proportionately as a stockholder of the Corporation), of
any loans, advances, guarantees, pledges or other financial assistance or any
tax credits or other tax advantages provided by or through the Corporation;
provided, however, that the term "Business Combination" shall not be deemed to
include the receipt of any of the foregoing benefits by the Corporation or any
of the Corporation's affiliates arising from transactions (such as intercompany
loans or tax sharing arrangements) between the Corporation and its affiliates in
the ordinary course of business.
6. "Common Stock" means any stock other than preferred stock.
7. "Consummation date" with respect to any Business Combination, means
the date of consummation of that Business Combination.
8. "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 Shares, by contract, or
otherwise. A person's beneficial ownership of 10% or more of the voting power of
the Corporation's Voting Shares shall create a presumption that person has
control of the Corporation. Notwithstanding the foregoing in this subsection, a
person shall not be deemed to have control of a corporation if that person holds
voting power, in good faith and not for the purpose of circumventing this
section, as an agent, bank, broker, nominee, custodian or trustee for one or
more Beneficial Owners who do not individually or as a group have control of the
Corporation.
9. "Exchange Act" means the "Securities Exchange Act of 1934" (15
U.S.C. ss. 78a et seq.), as the same has been or hereafter may be amended from
time to time.
10. "Interested Stockholder" when used in reference to the Corporation,
means any person (other than the Corporation or any subsidiary of the
Corporation) that:
(1) is the Beneficial Owner, directly or indirectly, of 10% or
more of the voting power of the outstanding Voting Shares of the Corporation;
(2) is an affiliate or associate of the Corporation and at any
time within the five-year period immediately prior to the date in question was
the Beneficial Owner, directly or indirectly, of 10% or more of the voting power
of the then outstanding stock of the Corporation. For the purpose of determining
whether a person is an Interested Stockholder pursuant to this subsection, the
number of shares of Voting Shares of the Corporation deemed to be outstanding
shall include shares deemed to be Beneficially Owned by the person through
application of subsection A.4 of this Article XV but shall not include any other
unissued shares of voting stock of the Corporation which may be issuable
pursuant to any agreement, arrangement or understanding, or upon exercise of
conversion rights, warrants or options, or otherwise; or
(3) is an assignee of or has otherwise succeeded to any shares
of Voting Shares which were at any time within the two-year period immediately
prior to the date in question Beneficially Owned by any Interested Stockholder,
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.
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11. "Market value" when used in reference to property of the
Corporation, means:
(1) in the case of stock, the highest closing sales price of
the stock during the 30 day period immediately preceding the date in question,
on the principal United States securities exchange registered under the Exchange
Act on which that stock is listed, or, if that stock is not listed on any such
exchange, the highest closing bid quotation with respect to a share of that
stock during the 30-day period preceding the date in question on the National
Association of Securities Dealers, Inc. Automated Quotation System, or any
system then in use, or if no such quotations are available, the fair market
value on the date in question of a share of the Corporation's stock as
determined by the board of directors of the Corporation in good faith; and
(2) in the case of property other than cash or stock, the fair
market value of that property on the date in question as determined by the board
of directors of the Corporation in good faith.
12. "Stock" means:
(1) any stock or similar security, any certificate of
interest, any participation in any profit sharing agreement, any voting trust
certificate, or any certificate of deposit for stock; and
(2) any security convertible, with or without consideration,
into stock, or any warrant, call or other option or privilege of buying stock
without being bound to do so, or any other security carrying any right to
acquire, subscribe to or purchase stock.
13. "Stock acquisition date" with respect to any person and the
Corporation, means the date that such person first becomes an Interested
Stockholder of the Corporation.
14. "Subsidiary" of the Corporation means any other corporation of
which voting stock having a majority of the votes entitled to be cast is owned,
directly or indirectly, by the Corporation.
15. "Voting Shares" shall mean any shares of the authorized stock of
the Corporation entitled to vote generally in the election of directors.
B. Approval of Business Combinations.
---------------------------------
The Corporation shall not engage in a Business Combination with any
Interested Stockholder for a period of five years following that Interested
Stockholder's stock acquisition date unless the Business Combination is approved
by a vote of two-thirds of the board of directors prior to the Interested
Stockholder's stock acquisition date.
In addition, the Corporation shall not engage in any Business
Combination with any Interested Stockholder of the Corporation at any time
unless one of the following three conditions are met:
1. the Business Combination is approved by a vote of two-thirds of the
board of directors of the Corporation prior to that Interested Stockholder's
stock acquisition date and thereafter approved by stockholders in accordance
with applicable law.
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2. the Business Combination is approved by the affirmative vote of the
holders of at least 80% of the Voting Shares not Beneficially Owned by that
Interested Stockholder at a meeting called for such purpose.
3. the Business Combination meets all of the following conditions:
(1) the aggregate amount of the cash and the market value, as
of the consummation date, of consideration other than cash to be received per
share by holders of outstanding shares of common stock of the Corporation in
that Business Combination is at least equal to the higher of the following:
(a) the highest per share price (including any
brokerage commissions, transfer taxes and soliciting dealers' fees) paid by that
Interested Stockholder for any shares of common stock of the same class or
series acquired by it (i) within the five-year period immediately prior to the
announcement date with respect to that Business Combination, or (ii) within the
five-year period immediately prior to, or in, the transaction in which that
Interested Stockholder became an Interested Stockholder, whichever is higher;
plus, in either case, interest compounded annually from the earliest date on
which that highest per share acquisition price was paid through the consummation
date at the rate for one-year United States Treasury obligations from time to
time in effect; less the aggregate amount of any cash dividends paid, and the
market value of any dividends paid other than in cash, per share of common stock
since that earliest date, up to the amount of that interest; and
(b) the market value per share of common stock on the
announcement date with respect to that Business Combination or on that
Interested Stockholder's stock acquisition date, whichever is higher; plus
interest compounded annually from that date through the consummation date at the
rate for one-year United States Treasury obligations from time to time in
effect; less the aggregate amount of any cash dividends paid, and the market
value of any dividends paid other than in cash, per share of common stock since
that date, up to the amount of that interest;
(2) the aggregate amount of the cash and the market value as
of the consummation date of consideration other than cash to be received per
share by holders of outstanding shares of any class or series of stock, other
than common stock, of the Corporation is at least equal to the highest of the
following (whether or not that Interested Stockholder has previously acquired
any shares of that class or series of stock):
(a) the highest per share price (including any
brokerage commissions, transfer taxes and soliciting dealers' fees) paid by that
Interested Stockholder for any shares of that class or series of stock acquired
by it (i) within the five-year period immediately prior to the announcement date
with respect to that Business Combination, or (ii) within the five-year period
immediately prior to, or in, the transaction in which that Interested
Stockholder became an Interested Stockholder, whichever is higher; plus, in
either case, interest compounded annually from the earliest date on which the
highest per share acquisition price was paid through the consummation date at
the rate for one-year United States Treasury obligations from time to time in
effect; less the aggregate amount of any cash dividends paid, and the market
value of any dividends paid other than in cash, per share of that class or
series of stock since that earliest date, up to the amount of that interest;
(b) the highest preferential amount per share to
which the holders of shares of that class or series of stock are entitled in the
event of any liquidation, dissolution or winding up of the Corporation, plus the
aggregate amount of any dividends declared or due at to which those holders are
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entitled prior to payment of dividends on some other class or series of stock
(unless the aggregate amount of those dividends is included in that preferential
amount); and
(c) the market value per share of that class or
series of stock on the announcement date with respect to that Business
Combination or on that Interested Stockholder's stock acquisition date,
whichever is higher; plus interest compounded annually from that date through
the consummation date at the rate for one-year United States Treasury
obligations from time to time in effect; less the aggregate amount of any cash
dividends paid, and the market value of any dividends paid other than in cash,
per share of that class or series of stock since that date, up to the amount of
that interest;
(3) the consideration to be received by holders of a
particular class or series of outstanding stock (including common stock) of the
Corporation in that Business Combination is in cash or in the same form as the
Interested Stockholder has used to acquire the largest number of shares of that
class or series of stock previously acquired by it;
(4) the holders of all outstanding shares of stock of the
Corporation not Beneficially Owned by that Interested Stockholder immediately
prior to the consummation of that Business Combination are entitled to receive
in that Business Combination in cash or other consideration for those shares in
compliance with paragraphs (1), (2) and (3) of this subsection; and
(5) after that Interested Stockholder's stock acquisition date
and prior to the consummation date with respect to that Business Combination,
that Interested Stockholder has not become the Beneficial Owner of any
additional shares of stock of the Corporation, except:
(a) as part of the transaction which resulted in that
Interested Stockholder becoming an Interested Stockholder;
(b) by virtue of proportionate stock splits, stock
dividends or other distributions of stock in respect of stock not constituting a
Business Combination as defined in subsection A.5(5) of this Article XV;
(c) through a Business Combination meeting all of the
conditions of paragraph (3) and this paragraph; or
(d) through the purchase by that Interested
Stockholder at any price which, if that price had been paid in an otherwise
permissible Business Combination, the announcement date and consummation date of
which was the date of that purchase, would have satisfied the requirements of
paragraphs (1), (2) and (3) of this subsection.
(6) Exceptions. The provisions of this Article XV shall not
----------
apply to any Business Combination of the Corporation with an Interested
Stockholder of the Corporation which became an Interested Stockholder
inadvertently, if such Interested Stockholder (i) as soon as practicable divests
itself, himself or herself of a sufficient amount of the Voting Shares of the
Corporation so that it, he or she no longer is the Beneficial Owner, directly or
indirectly, of 10% or more of the voting power of the outstanding Voting Shares
of the Corporation or a subsidiary corporation, and (ii) would not at any time
within the five- year period preceding the announcement date with respect to
that Business Combination have been an Interested Stockholder but for that
inadvertent acquisition. Nothing contained in this Article XV shall be construed
to relieve any Interested Stockholder from any fiduciary obligation imposed by
law.
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C. Evaluation of Business Combinations. In connection with the exercise
-----------------------------------
of its judgment in determining what is in the best interests of the Corporation
and of the stockholders, when evaluating a Business Combination or a tender or
exchange offer, the board of directors of the Corporation shall, in addition to
considering the adequacy of the amount to be paid in connection with any such
transaction, consider all of the following factors and any other factors which
it deems relevant: (i) the social and economic effects of entering into the
transaction on the Corporation and its subsidiaries, and its present and future
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 entity, including, but not limited to, debt service and
other existing financial obligations, financial obligations to be incurred in
connection with the acquisition, and other likely financial obligations of the
acquiring person or entity, 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 entity and its
or their management.
ARTICLE XVI
Stockholder Approval of Certain Transactions
--------------------------------------------
A. Stockholder Vote. Any merger, consolidation, liquidation, or
-----------------
dissolution of the Corporation or any action that would result in the sale or
other disposition of all or substantially all of the assets of the Corporation
("Transaction") shall require the affirmative vote of the holders of at least
eighty percent (80%) of the outstanding shares of capital stock of the
Corporation eligible to vote at a legal meeting.
B. Board Approval. The provisions of Section A of this Article XVI
---------------
shall not apply to a particular Transaction, and such Transaction shall require
only such stockholder vote, if any, as would be required under the New Jersey
Business Corporation Act, if such Transaction is approved by two-thirds of the
entire Board of Directors of the Corporation.
ARTICLE XVII
Elimination of Directors' and Officers' Liability
-------------------------------------------------
Directors and officers of the Corporation shall have no personal
liability to the Corporation or its stockholders for damages for breach of any
duty owed to the Corporation or its stockholders, provided that this Article
XVII shall not relieve a director or officer from liability for any breach of
duty based upon an act or omission (i) in breach of the director's or officer's
duty of loyalty to the Corporation or its stockholders, (ii) not in good faith
or involving a knowing violation of law, or (iii) resulting in receipt by such
person of an improper personal benefit. Any repeal or modification of this
Article XVII by the stockholders of the Corporation shall not adversely affect
any right or protection of a director or officer of the Corporation hereunder or
otherwise with respect to any act or omission occurring before such repeal or
modification is effective. If the New Jersey Business Corporation Act is amended
to further limit the personal liability of directors and officers, then such
liability will be limited to the fullest extent permitted under the law.
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ARTICLE XVIII
Indemnification
---------------
A. Indemnification. The Corporation 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 Corporation, whether civil, criminal, administrative, arbitrative or
investigative, by reason of the fact that such person is or was a director,
officer, employee or agent of the Corporation or of any constituent corporation
absorbed by the Corporation in a consolidation or merger, or is or was serving
at the request of the Corporation as a director, officer, employee or agent of
another Corporation, partnership, joint venture, sole proprietorship, trust or
other enterprise, against expenses (including attorneys' fees), judgements,
fines and amounts paid in settlement actually and reasonably incurred by such
person in connection with such action, suit or proceeding to the full extent
permissible under New Jersey law.
B. Advance Payment. The Corporation may pay in advance any expenses
----------------
(including attorneys' fees) which may become subject to indemnification under
Section A of this Article XVIII if the person receiving the payment undertakes
in writing to repay the same if it is ultimately determined that he or she is
not entitled to indemnification by the Corporation under New Jersey law.
C. Nonexclusive. The indemnification and advancement of expenses
------------
provided by Sections A and B of this Article XVIII or otherwise granted pursuant
to New Jersey law shall not be exclusive of any other rights to which a person
may be entitled by law, bylaw, agreement, vote of stockholders, or disinterested
directors, or otherwise.
D. Continuation. The indemnification and advance payment provided by
------------
Sections A and B of this Article XVIII shall continue as to a person who has
ceased to hold a position named in Section A and shall inure to his or her
heirs, executors and administrators. In addition, any repeal or modification of
this Article XVIII by the stockholders of the Corporation shall not adversely
affect any right or protection of a director or officer of the Corporation
hereunder or otherwise with respect to any act or omission occurring before such
repeal or modification is effective.
E. Insurance. The Corporation may purchase and maintain insurance on
---------
behalf of any person who holds or who has held any position named in Section A
of this Article XVIII, against any liability incurred by him or her in any such
position, or arising out of his or her status as such, whether or not the
Corporation would have power to indemnify him or her against such liability
under this Article XVIII and New Jersey law.
F. Savings Clause. If this Article XVIII or any portion hereof shall be
--------------
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each director, officer, employee, and
agent of the Corporation 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,
arbitrative or investigative, including an action by or in the right of the
Corporation to the full extent permitted by any applicable portion of this
Article XVIII that shall not have been invalidated and to the full extent
permitted by applicable law.
17
ARTICLE XIX
Amendment of Bylaws
-------------------
In furtherance and not in limitation of the powers conferred by
statute, the board of directors of the Corporation is expressly authorized to
make, repeal, alter, amend and rescind the Bylaws of the Corporation by a vote
of two-thirds of the board of directors present at a legal meeting held in
accordance with the provisions of the Bylaws. Notwithstanding any other
provision of this Certificate or the Bylaws of the Corporation (and
notwithstanding the fact that some lesser percentage may be specified by law),
the Bylaws shall not be made, repealed, altered, amended or rescinded by the
stockholders of the Corporation except by the vote of the holders of not less
than 80% of the outstanding shares of the 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 (provided that notice of such proposed adoption, repeal, alteration,
amendment or rescission is included in the notice of such meeting), or, as set
forth above, by the board of directors.
ARTICLE XX
Amendment of Certificate of Incorporation
-----------------------------------------
The Corporation reserves the right to repeal, alter, amend or rescind
any provision contained in this Certificate in the manner now or hereafter
prescribed by law, and all rights conferred on stockholders herein are granted
subject to this reservation. Notwithstanding the foregoing, the provisions set
forth in Articles VIII, X, XI, XII, XIII, XIV, XV, XVI, XVII, XVIII, XIX and
this Article XX of this Certificate may not be repealed, altered, amended or
rescinded in any respect unless such action is approved by the affirmative vote
of the holders of not less than 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 a single class) cast at a meeting of the
stockholders called for that purpose (provided that notice of such proposed
adoption, repeal, alteration, amendment or rescission is properly included in
the notice of such meeting).
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