EXHIBIT 4.1
The Registrant's Restated Articles of Incorporation
RESTATED ARTICLES OF INCORPORATION
OF
VIRGINIA BEACH FEDERAL FINANCIAL CORPORATION
ARTICLE I
Name
The name of the corporation is Virginia Beach Federal Financial
Corporation (herein the "Corporation").
ARTICLE II
Registered Office
The address of the Corporation's initial registered office in the
Commonwealth of Virginia is 210 25th Street, Virginia Beach, Virginia 23451,
which is located in the City of Virginia Beach.
ARTICLE III
Powers
The purpose for which the Corporation is organized is to act as a savings
and loan holding company and to transact all other lawful business for which
corporations may be incorporated pursuant to the laws of the Commonwealth of
Virginia. The Corporation shall have all the powers of a corporation organized
under the Virginia Stock Corporation Act, as the same may be from time to time
amended hereafter.
ARTICLE IV
Term
The Corporation is to have perpetual existence.
ARTICLE V
Capital Stock
The aggregate number of shares of all classes of capital stock which the
Corporation has authority to issue is 15,000,000, of which 10,000,000 are to be
shares of common stock, $.01 par value per share, and of which 5,000,000 are to
be shares of serial preferred stock, $.01 par value per share. The aggregate
number of shares of capital stock and the number of shares of common stock which
the Corporation has authority to issue may be increased by the affirmative vote
of the holders of a majority of the outstanding shares of capital stock entitled
to vote generally in the election of directors and the number of shares of
serial preferred stock which the Corporation has authority to issue may be
increased by the affirmative vote of the holders of a majority of the
outstanding shares of capital stock of the Corporation.
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 these Articles, the holders of 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 available under applicable law and Article VIII of these Articles for the
payment of dividends, but only when and 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 in any such event, 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.
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B. Issuance of Preferred Stock in Series. The board of directors is
authorized to issue preferred stock from time to time in one or more series and
to provide for the designations, preferences, limitations and relative rights of
each series by the adoption of Articles of Amendment to the Articles of
Incorporation of the Corporation fixing:
1. The maximum number of shares in the series and the designation of
the series, which designation shall distinguish the shares thereof from
the shares of any other series or class;
2. Whether shares of the series shall have special, conditional or
limited voting rights, or no right to vote, except to the extent
prohibited by law;
3. Whether shares of the series are redeemable or convertible (i) at
the option of the Corporation, a shareholder or another person or upon the
occurrence of a designated event, (ii) for cash, indebtedness, securities
or other property, and (iii) in a designated amount or in an amount
determined in accordance with a designated formula or by reference to
extrinsic data or events;
4. Any right of holders of shares of the series to distributions,
calculated in any manner, including dividends that may be cumulative,
noncumulative or partially cumulative;
5. Whether the shares of the series have preference over any other
class of shares with respect to distributions, including dividends and
distributions upon the dissolution of the Corporation;
6. Any other designations, preferences, limitations or rights,
including a right that no transaction shall be consummated while any such
shares remain outstanding except upon the assent of a majority of such
shares.
All shares of preferred stock, regardless of series, shall be identical in
all respects except to the extent that the Articles of Amendment establishing
different series set forth different designations, preferences, limitations or
relative rights as permitted in Paragraph B of this Article V. Before the
issuance of any shares of a series, Articles of Amendment establishing such
series shall be filed with and made effective by the State Corporation
Commission of Virginia, as required by law.
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ARTICLE VI
Dividends
A. Subject to the restrictions set forth in paragraph B of this Article
VI, the board of directors may, at any regular or special meeting, declare, and
the Corporation may pay, dividends on the Corporation's outstanding stock.
Dividends may be paid in cash, in property or in the Corporation's own shares.
B. No dividends may be paid in cash or in property if, after giving effect
to such payment:
1. The Corporation would not be able to pay its debts as they became
due in the usual course of business; or
2. The Corporation's total consolidated assets would be less than
the sum of its total consolidated liabilities.
ARTICLE VII
Dividends
No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or series 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 or other securities
convertible into or exchangeable for stock of any class or series or carrying
any right to purchase stock of any class or series; 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 VIII
Meetings of Shareholders; Cumulative Voting
A. Special meetings of the shareholders of the Corporation for any purpose
or purposes may be called at any time by the chairman of the board of directors
of the Corporation, by the president, by the board of directors, or by a
committee of the board of directors which
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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 such special meetings may not be called by any other person or
persons.
B. Meetings of shareholders may be held within or without the Commonwealth
of Virginia, as the bylaws may provide.
C. One-third of the outstanding shares of the Corporation entitled to
vote, represented in person or by proxy, shall constitute a quorum at a meeting
of shareholders.
D. There shall be no cumulative voting by shareholders of any class or
series in the election of directors of the Corporation.
ARTICLE IX
Notice for Nominations and Proposals
A. Nominations for the election of directors and proposals for any new
business to be taken up at any annual or special meeting of shareholders may be
made by the board of directors of the Corporation or by any shareholder of the
Corporation entitled to vote generally in the election of directors. In order
for a shareholder of the Corporation to make any such nominations and/or
proposals, he or she shall give notice thereof in writing, delivered or mailed
by first class United States mail, postage prepaid, to the Secretary of the
Corporation not less than 40 days nor more than 60 days prior to any such
meeting; provided, however, that if less than 41 days' notice of the meeting is
given to shareholders, such written notice shall be delivered or mailed as
prescribed, to the Secretary of the Corporation not later than the close of the
tenth day following the day on which notice of the meeting was mailed to
shareholders.
B. Each such notice given by a shareholder with respect to nominations for
the election of directors shall set forth (i) the name, age, business address
and, if known, residence address of each nominee proposed in such notice, (ii)
the principal occupation or employment of each such nominee, (iii) the number of
shares of stock of the Corporation which are beneficially owned by each such
nominee, (iv) such other information as would be required to be included in a
proxy statement soliciting proxies for the election of the proposed nominee
pursuant to Regulation 14A of the Securities Exchange Act of 1934, as amended
(as in effect as of the effective date of these Articles or as subsequently
amended, including any successor regulation), including, without limitation,
such person's written consent to being named in the proxy statement as a nominee
and to serving as a director, if elected, and (v) as to the shareholder giving
such notice (a) his name and address as they appear on the Corporation's books,
and (b) the class and number of shares of the Corporation which are beneficially
owned by such shareholder. In addition, the shareholder making such nomination
shall promptly provide any other information reasonably requested by the
Corporation.
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C. Each such notice given by a shareholder to the Secretary with respect
to business proposals to bring before a meeting shall set forth in writing as to
each matter: (i) a brief description of the business desired to be brought
before the meeting and the reasons for conducting such business at the meeting;
(ii) the name and address, as they appear on the Corporation's books, of the
shareholder proposing such business; (iii) the class and number of shares of the
Corporation which are beneficially owned by the shareholder; and (iv) any
material interest of the shareholder in such business. Notwithstanding anything
in these Articles to the contrary, no business shall be conducted at the meeting
except in accordance with the procedures set forth in this Article.
D. The Chairman of the annual or special meeting of shareholders may, if
the facts warrant, determine and declare to such meeting that a nomination or
proposal was not made in accordance with the foregoing procedure, and, if he
should so determine, he shall so declare to the meeting and the defective
nomination or proposal shall be disregarded and laid over for action at the next
succeeding adjourned, special or annual meeting of the shareholders taking place
thirty days or more thereafter. This provision shall not require the holding of
any adjourned or special meeting of shareholders for the purpose of considering
such defective nomination or proposal.
ARTICLE X
Directors
A. Number; Vacancies. The number of directors of the Corporation shall be
such number, not less than seven nor more than fifteen (exclusive of directors,
if any, to be elected by holders of preferred stock of the Corporation, voting
separately as a class), as shall from time to time be fixed by, or in the manner
provided in, the bylaws, provided that no decrease in the number of directors
shall have the effect of shortening the term of any incumbent director, and
provided further that no action shall be taken to decrease or increase the
number of directors from time to time unless at least 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 two-thirds of the directors then in office, whether
or not a quorum, and any director so chosen shall hold office for a term
expiring at the annual meeting of shareholders at which the term of the class to
which the director has been chosen expires and when the director's successor is
elected and qualified. Directors shall not be required to own any shares of the
Corporation's common stock and need not be residents of any particular state,
country or other jurisdiction.
B. Classified Boards. The board of directors of the Corporation shall be
divided into three classes of directors which shall be designated Class I, Class
II and Class III. The members of each class shall be elected for a term of three
years and until their successors are elected and qualified. Such classes shall
be as nearly equal in number as the then total number of directors constituting
the entire board of directors shall permit, with the terms of office of all
members
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of one class expiring each year. Should the number of directors not be equally
divisible by three, the excess director or directors shall be assigned to
Classes I or III as follows: (i) if there shall be an excess of one directorship
over a number equally divisible by three, such extra directorship shall be
classified in Class I; and (ii) if there be an excess of two directorships over
a number of equally divisible by three, one shall be classified in Class I and
the other in Class III. At the first annual meeting of shareholders, directors
of Class I shall be elected to hold office for a term expiring at the third
succeeding annual meeting thereafter. At the second annual meeting of
shareholders, directors of Class II shall be elected to hold office for a term
expiring at the third succeeding annual meeting thereafter. At the third annual
meeting of shareholders, directors of Class III shall be elected to hold office
for a term expiring at the third succeeding annual meeting thereafter.
Thereafter, at each succeeding annual meeting, directors of each class shall be
elected for three-year terms. Notwithstanding the foregoing, a director whose
term shall expire at any annual meeting shall continue to serve until such time
as his successor shall have been duly elected and shall have qualified unless
his 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.
Should the number of directors of the Corporation be 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 directors. Should the number of directors of the Corporation be
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 X. 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 shareholders.
ARTICLE XI
Removal of Directors
Notwithstanding any other provision of these Articles or the bylaws of the
Corporation, any director or the entire board of directors of the Corporation
may be removed, at any time, but only for cause and only by the affirmative vote
of holders of at least 66 2/3% of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election
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of directors (considered for this purpose as one class) cast at a meeting of the
shareholders called for that purpose. Notwithstanding the foregoing, whenever
the holders of any one or more series of preferred stock of the Corporation
shall have the right, voting separately as a class, to elect one or more
directors of the Corporation, only the holders of a class of preferred stock
voting separately may participate in a vote to remove said director.
ARTICLE XII
Limitation of Directors' and Officers' Liability
Directors and officers of the Corporation shall have no liability to the
Corporation or its stockholders for monetary damages rising from a single
transaction, occurrence or course of conduct, provided that the liability of an
officer or director shall not be limited if the officer or director engaged in
any wilful misconduct or knowing violation of criminal law or of any federal or
state securities law, including, without limitation, any claim of unlawful
insider trading or manipulation of the market for any security. If the Virginia
Stock Corporation Act is amended after the effective date of these Articles of
Incorporation to further eliminate or limit the personal liability of directors
or officers, then the liability of directors and officers of the Corporation
shall be eliminated or limited to the fullest extent permitted by the Virginia
Stock Corporation Act, as amended.
Any repeal or modification of the foregoing paragraph shall not adversely
affect the right or protection of a director or officer with respect to any act
or omission occurring before such repeal or modification.
ARTICLE XIII
Indemnification
A. Definitions. For purposes of this Article the following definitions
shall apply:
1. "Corporation" means this Corporation only and no predecessor
entity or other legal entity.
2. "expenses" include counsel fees, expert witness fees, and costs
of investigation, litigation and appeal, as well as any amounts expended
in asserting a claim for indemnification.
3. "liability" means the obligation to pay a judgment, settlement,
penalty, fine, or other such obligation, including, without limitation,
any excise tax assessed with respect to an employee benefit plan.
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4. "legal entity" means a corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise.
5. "predecessor entity" means a legal entity the existence of which
ceased upon its acquisition by the Corporation in a merger or otherwise.
6. "proceeding" means any threatened, pending, or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative and whether formal or informal.
B. Indemnification of Directors and Officers. The Corporation shall
indemnify and may contract in advance to indemnify an individual who is, was or
is threatened to be made a party to a proceeding because he is or was a director
or officer of the Corporation or, while a director or officer of the
Corporation, is or was serving the Corporation or any other legal entity in any
capacity at the request of the Corporation against all liabilities and
reasonable expenses incurred in the proceeding except such liabilities and
expenses as are incurred because of his willful misconduct or knowing violation
of the criminal law, regardless of whether the proceeding is by or in the right
of the Corporation. The determination that indemnification under this Paragraph
B is permissible and the evaluation as to the reasonableness of expenses in a
specific case shall be made, in the case of a director, as provided by law, and
in the case of an officer, in the same manner a provided by law for directors;
provided, however that if a majority of the directors of the Corporation has
changed after the date of the alleged conduct giving rise to a claim for
indemnification, such determination and evaluation shall, at the option of the
person claiming indemnification, be made by special legal counsel agreed upon by
the board of directors and such person. Unless a determination has been made
that indemnification is not permissible, the Corporation shall make advances and
reimbursements for expenses incurred by a director or officer in a proceeding
upon receipt of an undertaking from him to repay the same if it is ultimately
determined that he is not entitled to indemnification. Such undertaking shall be
an unlimited, unsecured general obligation of the director or officer and shall
be accepted without reference to his ability to make repayment. The termination
of a proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent shall not of itself create a presumption that
a director or officer acted in such a manner as to make him ineligible for
indemnification.
C. Indemnification of Others. The Corporation may, to a lesser extent or
to the same extent that the Corporation is required to provide indemnification
and make advances and reimbursements for expenses to its directors and officers,
provide indemnification and make advances and reimbursements for expenses to its
employees and agents, the directors, officers, employees and agents of its
subsidiaries and predecessor entities, and any person serving any other legal
entity in any capacity at the request of the Corporation, and, if authorized by
general or specific action of the board of directors, may contract in advance to
do so. The determination that indemnification under this Paragraph C is
permissible, the authorization of such indemnification and the evaluation as to
the reasonableness of expenses in a specific case shall be made as authorized
from time to time by general or specific action of the board of directors,
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which action may be taken before or after a claim for indemnification is made,
or as otherwise provided by law. No person's rights under Paragraph B of this
Article shall be limited by the provisions of this Paragraph C.
D. Miscellaneous. The rights of each person entitled to indemnification
under this Article shall inure to the benefit of his heirs, executors and
administrators. Special legal counsel selected to make determinations under this
Article may be counsel for the Corporation. Indemnification pursuant to this
Article shall not be exclusive of any other right of indemnification to which
any person may be entitled, including indemnification pursuant to a valid
contract, indemnification by legal entities other than the Corporation and
indemnification under polices of insurance purchased and maintained by the
Corporation or others. However, no person shall be entitled to indemnification
by the Corporation to the extent he is indemnified by another, including an
insurer. The Corporation is authorized to purchase and maintain insurance
against any liability arising from their service to the Corporation or any other
legal entity at the request of the Corporation regardless of the Corporation's
power to indemnify against such liability. The provisions of this Articles shall
not be deemed to prohibit the Corporation from entering into contracts otherwise
permitted by law with any individuals or legal entities, including those from
entering into contracts otherwise permitted by law with any individuals or legal
entities, including those named above, for the purpose of conducting the
business of the Corporation. If any provision of this Articles or its
application to any person or circumstance is held invalid by a court of
competent jurisdiction, the invalidity shall not affect other provisions of this
Article, and to this end the provisions of this Article are severable.
E. Amendments. No amendment, modification or repeal of this Article XIII
shall diminish the rights provided hereby to any person with respect to any
claim for indemnification arising, in any material respect, from any act or
event which took place prior to the effective time of the amendment,
modification or repeal.
ARTICLE XIV
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. Notwithstanding
any other provision of these Articles 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
shareholders of the Corporation except by the affirmative vote of the holders of
not less than 66 2/3% 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 shareholders called for
the 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.
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ARTICLE XV
Amendment of Articles of Incorporation
The Corporation reserves the right to repeal, alter, amend or rescind any
provision contained in these Articles in the manner now or hereafter prescribed
by law, and all rights conferred on shareholders herein are granted subject to
this reservation. Notwithstanding the foregoing, these Articles may not be
repealed, altered, amended or rescinded in any respect unless the same is
approved by the affirmative vote of the holders of not less than a 66 2/3% 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 shareholders called for that purpose (provided
that notice of such proposed adoption, repeal, alteration, amendment or
rescission is included in the notice of such meeting), except that Article V may
be amended by the affirmative vote of the holders of not less than a majority of
the outstanding shares of capital stock entitled to vote thereon.
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