EXHIBIT 3.1
RESTATED
ARTICLES OF INCORPORATION
OF
NORTH BAY BANCORP
TERRY L. ROBINSON and WYMAN G. SMITH hereby certify that:
FIRST: They are the President and Chief Executive Officer and the Secretary,
respectively, of North Bay Bancorp, a California corporation.
SECOND: The articles of incorporation, as amended to the date of the filing of
this certificate, without alterations or amendments (other than omissions
required by Section 910 of the Corporations Code) are restated as follows:
I.
NAME
The name of this corporation is North Bay Bancorp.
II.
PURPOSE
The purpose of the corporation is to engage in any lawful act or activity
for which a corporation may be organized under the General Corporation Law of
California other than the banking business, the trust company business or the
practice of a profession permitted to be incorporated by the California
Corporations Code.
III.
[RESERVED]
IV.
AUTHORIZED STOCK
North Bay Bancorp (hereinafter the "Corporation") is authorized to issue
two classes of shares, designated "Common Stock" and "Preferred Stock,"
respectively. The number of shares of Common Stock authorized to be issued is
Fifteen Million (15,000,000) and the number of shares of Preferred Stock
authorized to be issued is Five Hundred Thousand (500,000).
The voting powers, designations, preferences, privileges and relative,
participating, optional or other special rights, and the qualifications,
limitations or restrictions of each class of capital stock of the Corporation,
shall be as provided in this Article IV.
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A. SERIES A PREFERRED STOCK.
1. Designation and Amount. A total of One Hundred Thousand (100,000)
shares of the Corporation's Preferred Stock shall be designated as a series
known as Series A Preferred Stock, no par value (the "Series A Preferred
Stock"). Such number of shares may be increased or decreased by resolution of
the Board of Directors; provided that no decrease shall reduce the number of
Series A Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the exercise of
outstanding, options, rights or warrants or upon the conversion of any
outstanding securities issued by the Corporation convertible into Series A
Preferred Stock. The rights, preferences, privileges, and restrictions granted
to and imposed on the Series A Preferred Stock are as set forth below in this
Article IV.A.
2. Dividends and Distributions.
(a) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and superior to
the Series A Preferred Stock with respect to dividends, the holders of shares of
Series A Preferred Stock, in preference to the holders of Common Stock of the
Corporation, and of any other junior stock, shall be entitled to receive, when,
as and if declared by the Board of Directors out of funds legally available for
the purpose, quarterly dividends payable in cash on the last day of March, June,
September, and December in each year (each such date being referred to herein as
a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (i) $0.25 or (ii) subject to the provision for
adjustment hereinafter set forth, the aggregate per share amount of all cash
dividends, and the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions, other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment date, or with respect to the
first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Preferred Stock. In the event the Corporation
shall at any time declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the amount to which holders of
shares of Series A Preferred Stock were entitled immediately prior to such event
under clause (ii) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number or shares of Common Stock that were outstanding immediately
prior to such event.
(b) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (a) of this Section
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock); provided that in the
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event no dividend or distribution shall have been declared on the Common Stock
during the period between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $0.25 per share on the
Series A Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares, unless the date of
issue of such shares is prior to the record date for the first Quarterly
Dividend Payment Date, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment Date, in
either of which events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall
not bear interest. Dividends paid on shares of Series A Preferred Stock in an
amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of Series A Preferred
Stock entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be not less than 10 nor more 60 days prior to
the date fixed for the payment thereof.
3. Voting Rights.
The holders of shares of Series A Preferred Stock shall have the following
voting rights:
(a) Each share of Series A Preferred Stock shall entitle the
holder thereof to one vote on all matters submitted to a vote of the
shareholders of the Corporation.
(b) Except as otherwise provided herein, in any Certificate of
Determination creating a series of Preferred Stock or any similar stock, or by
law, the holders of shares of Series A Preferred Stock and the holders of shares
of Common Stock and any other capital stock of the Corporation having general
voting rights shall vote together as one class on all matters submitted to a
vote of shareholders of the Corporation.
4. Certain Restrictions.
(a) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in Section 2
above are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock;
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(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either as to
dividends or up liquidation, dissolution or winding up) with the Series A
Preferred Stock, except dividends paid ratably on the Series A Preferred
Stock and all such parity stock on which dividends are payable or in
arrears in proportion to the total amounts to which the holders of all such
shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Preferred
Stock, provided that the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such junior stock in exchange for shares of
any stock of the Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any shares of
stock ranking on a parity with the Series A Preferred Stock, except in
accordance with a purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such shares upon
such terms as the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will result in
fair and equitable treatment among the respective series or classes.
(b) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock in the Corporation unless the Corporation could, under paragraph (a) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
5. Reacquired Shares. Any shares of Series A Preferred Stock purchased
or otherwise acquired by the Corporation in any manner whatsoever shall be
retired and cancelled promptly after the acquisition thereof. All such shares
shall upon their cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred Stock subject to
the conditions and restrictions on issuance set forth herein or in any
Certificate of Determination creating a series of Preferred Stock or any similar
stock or as otherwise required by law.
6. Liquidation, Dissolution or Winding Up.
Upon any liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (a) to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock unless, prior thereto, the holders of shares of Series
A Preferred Stock shall have received an amount per share equal to $100.00, plus
an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment, provided that the holders
of shares of Series A Preferred Stock shall be entitled to receive an aggregate
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amount per share, subject to the provision for adjustment hereinafter set forth,
equal to the aggregate amount to be distributed per share to holders of shares
of Common Stock, or (b) to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except distributions made ratably on the Series A
Preferred Stock and all such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each case the aggregate amount to which
holders of shares of Series A Preferred Stock were entitled immediately prior to
such event under the proviso in clause (a) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
7. Consolidation, Merger, etc.
In case the Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series A Preferred Stock shall at
the same time be similarly exchanged or changed into an amount per share subject
to the provision for adjustment hereinafter set forth equal to the aggregate
amount of stock, securities, cash and/or any other property (payable in kind),
as the case may be, into which or for which each share of Common Stock is
changed or exchanged. In the event the Corporation shall at any time declare or
pay any dividend on the Common Stock payable in shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock, then in each
such case the amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number shares of Common Stock that were outstanding
immediately prior to such event.
8. Redemption.
The shares of Series A Preferred Stock shall not be redeemable.
9. Rank.
The Series A Preferred Stock shall rank, with respect to the payment of
dividends and the distribution of assets, junior to all other series of the
Corporation's Preferred Stock, unless the terms of any such series shall provide
otherwise.
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10. Amendment.
The Articles of Incorporation (including any Certificate of Determination
issued under the authority of said Articles) of the Corporation shall not be
amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so as to affect
them adversely without the affirmative vote of the holders of at least
two-thirds of the outstanding shares of Series A Preferred Stock, voting
together as a single series.
B. COMMON STOCK.
1. Voting Rights. The holder of each share of Common Stock shall have
the right to one vote, and shall be entitled to notice of any meeting of the
shareholders' of this Corporation in accordance with the Bylaws of the
Corporation, and shall be entitled to vote upon such matters and in such manner
as may be provided by law.
2. Dividends. Subject to the prior rights of holders of all classes of
stock at the time outstanding having prior rights as to dividends, the holders
of the Common Stock shall be entitled to receive, when and as declared by the
Board, out of any assets of this Corporation legally available therefore, such
dividends as may be declared from time to time by the Board.
3. Liquidation Rights. Upon the liquidation, dissolution or winding up
of this Corporation, the assets of this Corporation shall be distributed as
provided in Article IV.A.6. hereof.
V.
LIABILITY LIMITATION
The liability of the directors of the Corporation for monetary damages
shall be eliminated to the fullest extent permissible under California law.
VI.
INDEMNIFICATION
The Corporation is authorized to provide indemnification of agents (as
defined in Section 317 of the California Corporations Code) through bylaws,
agreements with agents, vote of shareholders or disinterested directors or
otherwise, in excess of the indemnification otherwise permitted by Section 317
of the California Corporations Code, subject only to the applicable limits set
forth in Section 204 of the California Corporations Code.
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VII.
BUSINESS COMBINATIONS
The shareholder vote required to approve Business Combinations (as herein
defined) shall be as set forth in this Article.
A. CERTAIN DEFINITIONS.
For purposes of this Article:
1. "Voting Stock" shall mean all of the then-outstanding shares of the
capital stock of the Corporation entitled to vote generally in the election of
directors, voting together as a single class (it being understood that, for
purposes of this Article, each share of the Voting Stock shall have the number
of votes granted to it pursuant to Article IV of these Articles of Incorporation
or any designation of the rights, powers and preferences of any class or series
of Preferred Stock made pursuant to said Article IV (a "Preferred Stock
Designation").
2. A "person" shall mean any individual, firm, corporation, trust,
partnership, association or other entity.
3. "Affiliates", "affiliated" and "Associates" shall have the
respective meaning ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as in effect on June 1,
1999.
4. "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 Interested
Shareholder set forth in paragraph 6 of this Section A, 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.
5. A person shall be a "beneficial owner" or "beneficially own" or
have "beneficial ownership" of any Voting Stock:
(a) which such person or any of its Affiliates or Associates
beneficially owns, directly or indirectly; or
(b) which such person or any of its Affiliates or Associates 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 or upon the exercise of conversion rights, exchange rights,
warrants or options, or otherwise, or (ii) the right to vote or to direct the
voting thereof pursuant to any agreement, arrangement or understanding; or
(c) 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 purposes of acquiring, holding,
voting or disposing of any shares of Voting Stock.
6. "Interested Shareholder" shall mean any person (other than the
Corporation or any Subsidiary) who or which:
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(a) is the beneficial owner, directly or indirectly, of more than
twenty percent (20%) of the voting power of the then-outstanding Voting Stock;
or
(b) 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 twenty percent (20%) or more of the voting
power of the then-outstanding Voting Stock; or
(c) is an assignee of or has otherwise succeeded to the
beneficial ownership of any shares of Voting Stock which were at any time within
the two-year period immediately prior to the date in question beneficially owned
by any Interested Shareholder, 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.
7. For the purposes of determining whether a person is an Interested
Shareholder pursuant to paragraph 6 of this Section A, the number of shares of
Voting Stock deemed to be outstanding shall include shares deemed owned through
application of paragraph 5 of this Section A but shall not include any other
shares of Voting Stock which may be issuable pursuant to any agreement,
arrangement or understanding, or upon exercise of conversion rights, warrants or
options, or otherwise.
8. "Continuing Director" means any member of the Board of Directors of
the Corporation (the "Board") who is not affiliated with the Interested
Shareholder and was a member of the Board prior to the time that the Interested
Shareholder became an Interested Shareholder, or any successor of a Continuing
Director who is unaffiliated with the Interested Shareholder and is recommended
to succeed a Continuing Director by a majority of Continuing Directors then on
the Board.
9. "Fair Market Value" means: (a) in the case of stock on a given
date, the highest closing sale price during the 30-day period immediately
preceding such date of a share of such stock on the Composite Tape for New York
Exchange-Listed Stocks or, if such stock is not quoted on the Composite Tape of
the New York Stock Exchange or, if such stock is not listed on such Exchange, on
the principal United States securities exchange registered under the Securities
Exchange Act of 1934 on which such stock is listed or, if such stock is not
listed on any such exchange, the highest closing bid quotation with respect to a
share of such stock during the 30-day period preceding such date 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
such date of a share of such stock as determined by the Board in good faith; and
(b) in the case of property other than cash or stock, the fair market value of
such property on such date as determined by the Board in good faith.
10. "Business Combinations" shall include:
(a) any merger or consolidation of the Corporation or any
Subsidiary with (i) any Interested Shareholder or (ii) any other corporation
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(whether or not itself an Interested Shareholder) which is, or after such merger
or consolidation would be an Interested Shareholder or an Affiliate or Associate
of an Interested Shareholder; or
(b) any sale, lease, exchange, mortgage, pledge, grant of a
security interest, transfer or other disposition (in one transaction or a series
of transactions) directly or indirectly to or with any Interested Shareholder or
any Affiliate or Associate of any Interested Shareholder of any assets of the
Corporation or any Subsidiary having an aggregate Fair Market Value of ten
percent (10%) or more of the total value of the assets of the Corporation and
its consolidated subsidiaries reflected in the most recent balance sheet of the
Corporation; or
(c) the issuance or transfer by the Corporation or any Subsidiary
(in one transaction or a series of transactions) of any securities of the
Corporation or any Subsidiary to any Interested Shareholder or any Affiliate or
Associate of any Interested Shareholder in exchange for cash, securities or
other property (or a combination thereof) having an aggregate Fair Market Value
of $10,000,000 or more; or
(d) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation proposed by or on behalf of any Interested
Shareholder or any Affiliate or Associate of any Interested Shareholder; except
that this provision shall not limit the right of shareholders to elect
voluntarily to wind up or dissolve the Corporation by the vote of shareholders
holding shares of stock representing more than fifty percent (50%) of the stock
then entitled to vote in the election of directors; or
(e) any reclassification of the Corporation's securities
(including any reverse stock split), or recapitalization of the Corporation, or
any merger or consolidation of the Corporation with any of its Subsidiaries or
any other transaction (whether or not with or into or otherwise involving any
Interested Shareholder) which has the effect, directly or indirectly, of
increasing the proportionate beneficial ownership of any Interested Shareholder
or any Affiliate or Associate of any Interested Shareholder in the outstanding
shares of any class of equity or convertible securities of the Corporation or
any Subsidiary; or as a result of which the shareholders of the Corporation
would cease to be shareholders of a corporation incorporated under the laws of
the State of California having, as part of its articles of incorporation,
provisions to the same effects as this Article VII.
11. In the event of any Business Combination in which the Corporation
survives, the phrase "consideration other than cash to be received" shall
include the shares of any class of outstanding Voting Stock retained by the
holders of such shares.
12. "Announcement Date" shall mean the date of the first public
announcement of a proposed Business Combination.
13. "Determination Date" shall mean the date on which the Interested
Shareholder became an Interested Shareholder.
14. "Consummation Date" shall mean the date of the consummation of the
Business Combination.
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B. VOTING REQUIREMENTS.
Except as otherwise provided in Section C of this Article VII, a Business
Combination shall require (1) the affirmative vote of at least sixty-six and two
thirds percent (66-2/3%) of the voting power of the then-outstanding Voting
Stock and (2) the affirmative vote of the holders of at least a majority of the
voting power of all the then-outstanding shares of the Voting Stock other than
the Voting Stock of which an Interested Shareholder or an Affiliate is the
beneficial owner, voting together as a single class. Such affirmative votes
shall be required notwithstanding any other provisions of these Articles of
Incorporation or any provision of law or of any agreement with any national
securities exchange which might otherwise permit a lesser vote or no vote, but
such affirmative votes shall be required in addition to any affirmative vote of
the holders of any particular class or series of the Voting Stock required by
law, these Articles of Incorporation, any Preferred Stock Designation or
otherwise.
C. PRICE AND PROCEDURE REQUIREMENTS.
The provisions of Section B of this Article VII shall not be applicable to
any particular Business Combination, and such Business Combination shall require
only such affirmative vote as is required by law, and any other provision of the
Articles of Incorporation, any Preferred Stock Designation, any agreement with
any national securities exchange or otherwise if, in the case of a Business
Combination that does not involve any cash or other consideration being received
by the shareholders of the Corporation, solely in their respective capacities as
shareholders of the Corporation, the condition specified in the following
paragraph 1 is met, or in the case of any other Business Combination, the
conditions specified in either of the following paragraphs 1 or 2 are met:
1. The Business Combination shall have been approved by a majority of
the Continuing Directors, it being understood that this condition shall not be
capable of satisfaction unless there is at least one Continuing Director.
2. All of the following conditions shall have been met:
(a) The aggregate amount of the cash and the Fair Market Value,
as of the Consummation Date, of consideration other than cash to be received per
share by holders of common shares of the Corporation in such Business
Combination shall be not less than the highest of the following (in each case
appropriately adjusted in the event of any stock dividend, stock split,
combination of shares or similar event):
(i) (if applicable) (a) the highest per share price
(including any brokerage commissions, transfer taxes, and soliciting
dealers' fees) paid by the Interested Shareholder for any common shares of
the Corporation acquired or beneficially owned by it that were acquired
within the two-year period immediately prior to the Announcement Date or in
the transaction in which it became an Interested Shareholder, whichever is
higher, plus (b) interest thereon at the rate for 90-day United States
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Treasury obligations in effect on the Determination Date, calculated and
compounded annually from that date until the Consummation Date, less the
per share amount of cash dividends payable to holders of record on record
dates occurring in the interim, up to the amount of such interest;
(ii) the Fair Market Value per common share of the
Corporation on the Announcement Date; or
(iii) the Fair Market Value per common share of the
Corporation on the Determination Date.
(b) The aggregate amount of the cash and the Fair Market Value,
as of the Consummation Date, of consideration other than cash to be received per
share by the holders of less than the highest class (or series) of Voting Stock
in such Business Combination shall be not less than the highest of the following
(in each case appropriately adjusted in the event of any stock dividend, stock
split, combination of shares or similar event), it being intended that the
requirements of this paragraph (b) be met with respect to each class and series
of Voting Stock, whether or not the Interested Shareholder has previously
acquired any shares of a particular class or series:
(i) (if applicable) (a) the highest per share price
(including any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid by the Interested Shareholder for any shares of such
class (or series) of Voting Stock acquired or beneficially owned by it that
were acquired within the two-year period immediately prior to the
Announcement Date or in the transaction in which it became an Interested
Shareholder, whichever is higher, plus (b) interest thereon at the rate for
90-day United States Treasury obligations in effect on Determination Date,
calculated and compounded annually from that date until the Consummation
Date, less the per share amount of cash dividends payable to holders of
record on record dates occurring in the interim, up to the amount of such
interest;
(ii) (if applicable) the highest preferential amount per
share to which the holders of shares of such class (or series) of Voting
Stock are entitled in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation;
(iii) the Fair Market Value per share of such class (or
series) of Voting Stock on the Announcement Date; and
(iv) the Fair Market Value per share of such class (or
series) of Voting Stock on the Determination Date.
(c) The consideration to be received by holders of a particular
class (or series) of Voting Stock shall be in cash or in the same form as the
Interested Shareholder has previously paid for shares of such class (or series)
of Voting Stock. If the Interested Shareholder has paid for shares of any class
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(or series) of Voting Stock with varying forms of consideration, the form of
consideration for such class (or series) of Voting Stock shall be either cash or
the form used to acquire the largest number of such shares.
(d) All shares of Voting Stock of which the Interested
Shareholder is not the beneficial owner immediately prior to the Consummation
Date shall be exchanged in such Business Combination only for cash or other
consideration meeting all of the terms and conditions of this Section C;
provided, however, that the failure of any shareholder, exercising a statutory
right to dissent from such Business Combination and to receive payment of the
Fair Market Value of shares, to exchange shares in such Business Combination
shall not be deemed to have prevented satisfaction of the condition set forth in
this paragraph (d).
(e) After such Interested Shareholder has become an Interested
Shareholder and prior to the consummation of such Business Combination: (i)
except as approved by a majority of Continuing Directors, there shall have been
no failure to declare and pay at the regular date therefor any full quarterly
dividends (whether or not cumulative) on any outstanding Preferred Stock; (ii)
there shall have been (A) no reduction in the annual rate of dividends paid on
the Common Stock (except as necessary to reflect any subdivision of the Common
Stock), except as approved by a majority of Continuing Directors, and (B) an
increase in such annual rate of dividends as necessary to reflect any
reclassification (including any reverse stock split), recapitalization,
reorganization or any similar transaction which has the effect of reducing the
number of outstanding shares of the Common Stock, unless the failure so to
increase such annual rate is approved by a majority of the Continuing Directors;
and (iii) such Interested Shareholder shall have not become the beneficial owner
of any additional shares of Voting Stock except as part of the transaction which
results in such Interested Shareholder becoming an Interested Shareholder.
(f) After such Interested Shareholder has become an Interested
Shareholder, such Interested Shareholder shall not have received the benefit,
directly or indirectly (except proportionately, solely in such Interested
Shareholder's capacity as a shareholder of the Corporation), of any loans,
advances, guarantees, pledges or other financial assistance or any tax credits
or other tax advantages provided by the Corporation or any subsidiary of the
Corporation, whether in anticipation of or in connection with such Business
Combination or otherwise.
(g) A proxy or information statement describing the proposed
Business Combination and complying with the requirements of the Securities
Exchange Act of 1934 and the rules and regulations thereunder (or any subsequent
provisions replacing such Act, rules or regulations) shall be mailed to all
shareholders of the Corporation at least thirty (30) days prior to the
Consummation Date (whether or not such proxy or information statement is
otherwise required) and the Continuing Directors, if there are any at the time,
shall be provided a reasonable opportunity to state therein their views
respecting such proposed Business Combination and to include therewith an
opinion of an independent investment banker selected by the Continuing Directors
with respect to such Business Combination.
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(h) A state or federal regulatory authority having jurisdiction
under the circumstances shall have determined that the Business Combination is
fair to the holders of the Voting Stock.
D. POWERS OF THE BOARD OF DIRECTORS.
A majority of the total number of authorized directors (whether or not
there exist any vacancies in previously authorized directorships at the time any
such determination as is hereinafter in this Section D specified is to be made
by the Board) shall have the power and duty to determine, on the basis of
information known to them after reasonable inquiry, all facts necessary to
determine compliance with this Article VII, including, without limitation, (1)
whether a person is an Interested Shareholder, (2) the number of shares of
Voting Stock beneficially owned by any person, (3) whether a person is an
Affiliate or Associate of another, and (4) whether the applicable conditions set
forth in Section C of this Article VII have been met with respect to any
Business Combination.
E. NO EFFECT ON FIDUCIARY OBLIGATIONS OR INTERESTED SHAREHOLDERS.
Nothing contained in this Article shall be construed to relieve any
Interested Shareholder from any fiduciary obligation imposed by law.
F. AMENDMENT, REPEAL, ETC.
Notwithstanding any other provision of these Articles of Incorporation or
the Bylaws (and notwithstanding the fact that a lesser percentage may be
specified by law, these Articles of Incorporation or the Bylaws) the affirmative
vote of the holders of at least sixty-six and two thirds percent (66-2/3%) or
more of the outstanding Voting Stock, voting together as a single class, shall
be required to amend or repeal or adopt any provision inconsistent with this
Article or any provisions thereof.
VIII.
EVALUATION OF BUSINESS COMBINATIONS, ETC.
In connection with the exercise of its judgement in determining what is in
the best interest of the Corporation and of the shareholders, when evaluating a
"Business Combination," as defined in Article VII of these Articles of
Incorporation, or a proposal by another person or persons to make 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 may deem relevant:
1. 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;
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2. The business and financial condition and earning prospects of the
acquiring person or persons, 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 persons, and the possible effect of such condition upon the
Corporation and its subsidiaries and the other elements of the communities in
which the Corporation and its subsidiaries operate or are located;
3. The competence, experience and integrity of the acquiring person or
persons and its or their management;
4. Whether the proposed transaction might violate federal or state
law; and
5. Not only the consideration being offered in a proposed transaction
and related to the current market price for the outstanding capital stock of the
Corporation, but also to the market price for the capital stock of the
Corporation over a period of years, the estimated price that might be achieved
in a negotiated sale of the Corporation as a whole or in part, and the
Corporation's future value as an independent entity."
THIRD: These restated articles of incorporation have been duly approved by the
Board of Directors.
/s/ Terry L. Robinson /s/ Wyman G. Smith
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Terry L. Robinson Wyman G. Smith
President Corporate Secretary
Terry L. Robinson and Wyman G. Smith, the duly elected and acting President
and Corporate Secretary, respectively, of the corporation, declare under penalty
of perjury under the laws of the State of California that they have read the
foregoing Restated Articles of Incorporation and know the contents thereof, and
that the same is true of their own knowledge.
Executed at Napa, California on February 28, 2005
/s/ Terry L. Robinson /s/ Wyman G. Smith
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Terry L. Robinson Wyman G. Smith III
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