Exhibit 3.1 (as filed with the South Carolina
Secretary of State on July 23, 1999)
STATE OF SOUTH CAROLINA
SECRETARY OF STATE
ARTICLES OF INCORPORATION
ISLANDS BANCORP
1. Name. The name of the Corporation is Islands Bancorp.
2. Registered Office and Agent. The registered office of the Corporation is
500-A, Carteret Street in the city of Beaufort, South Carolina 29902,
and the registered agent at such address is William B. Gossett.
3. Stock. The Corporation is authorized to issue two classes of stock as
follows:
Class of Shares Authorized Number of Each Class
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Common Stock 10,000,000 shares
Preferred Stock 2,000,000 shares
The relative rights, preferences, and limitations of the shares of each
class, and of each series within a class, are as follows:
a. Common Stock. Authority is hereby expressly granted to and vested
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in the Board of Directors of the Corporation to provide for the issue of
common stock. The Corporation's shares of common stock shall have no par
value. The holders of record of shares of common stock shall be entitled
to unlimited voting rights equating to one (1) vote per outstanding share
of common stock on all matters upon which shareholders are entitled to
vote. Shares of common stock shall have distribution, dividend, and
liquidation rights granted by law or declared by resolution or resolutions
of the Board of Directors from time to time, except that in the absence of
the establishment of liquidation rights for one or more series of preferred
stock (either preferentially to, or on a parity with, the common stock) as
provided below, the holders of record of shares of common stock shall be
entitled to receive the net assets of the Corporation upon dissolution.
The distribution, dividend, and liquidation rights associated with the
shares of common stock will be subordinated only to the comparable
distribution, dividend, or liquidation rights associated with shares of
certain series of preferred stock, if any, but only to the extent such
preferences, if any, are established for one or more series of preferred
stock by the Board of Directors in its discretion as provided below.
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ISLANDS BANCORP
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b. Preferred Stock. Authority is also hereby expressly granted to
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and vested in the Board of Directors of the Corporation to provide for the
issue of preferred stock in one or more series, and in connection therewith
to establish by resolution or resolutions of the Board of Directors from
time to time providing for the issue of such series, the number of shares
to be included in such series, the designation thereof, and the relative
rights, preferences, and limitations of each series and the variations in
such rights, preferences, and limitations as between series, all to the
fullest extent permitted by Section 33-6-102 of the South Carolina Business
Corporations Act of 1988, as amended from time to time (the "Act").
Without limiting the generality of the grant of authority contained in the
preceding sentence, the Board of Directors is authorized to determine any
or all of the following with respect to any series of the preferred stock,
and the shares of each series may vary from the shares of any other series
in any or all of the following respects:
(i) The number of shares of such series (which may
subsequently be increased, except as otherwise provided by the
resolution or resolutions of the Board of Directors providing for the
issue of such series, or decreased to a number not less than the
number of shares then outstanding) and the distinguishing designation
thereof.
(ii) The distribution, dividend, and liquidation rights, if
any, of such series; the distribution, dividend, or liquidation
preferences, if any, as between such series and any other class or
series of stock; whether and the extent to which shares of such series
shall be entitled to participate in any distributions, dividends, or
liquidation proceeds with shares of any other class or series of
stock; whether and the extent to which any distributions, dividends,
or liquidation proceeds on such series shall be cumulative,
noncumulative, or partially cumulative, and any limitations,
restrictions, or conditions on the payment of such distributions,
dividends, or liquidation proceeds; and whether and the extent to
which share dividends of one series of preferred stock may be issued
in respect of shares of another series or class without approval of
the holders of the series from which the share dividend is to be
issued.
(iii) The time or times during which, the price or prices at
which, and any other terms or conditions on which, the shares of such
series may be redeemed, if redeemable, including without limitation,
whether redeemable at the option of the Corporation, the shareholder,
or any other person.
(iv) The par value or absence of par value, and other economic
features of such series.
(v) The voting powers, if any, in addition to the voting
powers prescribed by law for shares of such series as a voting group,
if any, and the conditions upon effectiveness, and the terms and
limitations for exercise of, such voting powers.
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ISLANDS BANCORP
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(vi) Whether shares of such series shall be convertible into or
exchangeable for shares of any other series or class of stock
(including without limitation, shares of common stock) or any other
securities, and the terms and conditions, if any, applicable to such
right, including without limitation, whether convertible or
exchangeable at the option of the Corporation, the shareholder or any
other person.
(vii) The terms and conditions of applicable purchase,
retirement, or sinking fund, if any, which may be provided for the
shares of such series.
(viii) The restrictions, if any, upon the creation of
indebtedness, payment of distributions on other classes or series of
stock, or creation or issuance of additional securities, ranking on a
parity with or prior to such series.
(ix) Other relative, participating, optional, or special
rights, qualifications, limitations, values, or restrictions, if any,
for shares of such series.
Each such series of preferred stock shall be eligible for issue upon the
Board of Directors duly adopting the appropriate resolution or resolutions
and filing with the Secretary of State of South Carolina of articles of
amendment as set forth in Section 33-6-102 of the Act, which shall be
effective without shareholder action.
4. Existence. The existence of the corporation shall begin when these
Articles of Incorporation are filed with the Secretary of State, and
the period of duration of the Corporation shall be perpetual.
5. Optional Provisions. The optional provisions which the Corporation elects
to include in the Articles of Incorporation are as follows:
a. Preemptive Rights. The Corporation elects not to have preemptive
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rights. No shareholder shall be entitled to preemptive rights, and no
shares of stock of any class issued by the Corporation shall be subject to
any preemptive rights.
b. Cumulative Voting. The Corporation elects not to have cumulative
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voting. No shareholder shall be entitled to vote cumulatively for election
of directors, and no shares of stock of any class issued by the Corporation
may be cumulatively voted for election of directors.
c. Staggered Director Terms. At any time that the Board of Directors
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of the Corporation consists of six or more directorships, unless provided
otherwise by the Articles of Incorporation, the terms of office of
directors will be staggered by dividing the total number of directors into
three classes, with each class accounting for one-third, as near as may be,
of the total number of directorships. The terms of directors in the first
class will expire at the first annual shareholders' meeting after their
election, the terms of the second class will expire at the second annual
shareholders' meeting after their election, and the terms
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ISLANDS BANCORP
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of the third class will expire at the third annual shareholders' meeting
after their election. At each annual shareholders' meeting held thereafter,
directors shall be chosen for a term of three years to succeed those whose
terms expire. If the number of directorships is changed, any increase or
decrease shall be so apportioned among the classes as to make all classes
as nearly equal in number as possible, and when the number of directorships
is increased and any newly created directorships are filled by the Board of
Directors, the terms of the additional directors shall expire at the next
election of directors by the shareholders. Each director, except in the
case of his or her earlier death, written resignation, retirement,
disqualification or removal, shall serve for the duration of his or her
term, as staggered, and thereafter until his or her successor shall have
been elected and qualified.
d. Director Immunity. No director of the Corporation shall be
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personally liable to the Corporation or its shareholders for monetary
damages for breach of such director's fiduciary duty as a director;
provided however, the foregoing shall not eliminate or limit the liability
of a director: (i) for any breach of the director's duty of loyalty to the
Corporation or its shareholders; (ii) for acts or omissions not in good
faith or which involve gross negligence, intentional misconduct, or a
knowing violation of law; (iii) imposed for unlawful distributions as set
forth in Section 33-8-330 of the Act; or (iv) for any transaction from
which the director derived an improper personal benefit. This provision
shall eliminate or limit the liability of a director of the Corporation to
the maximum extent permitted from time to time by the Act or any successor
law or laws. Any repeal or modification of the foregoing protection by the
shareholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such
repeal or modification.
e. Evaluation of Offers. To the fullest extent permitted by law, the
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Board of Directors, when evaluating any offer by another party to (i) make
a tender or exchange offer for any equity security of this Corporation
outside of the ordinary course of business, (ii) merge or consolidate this
Corporation with any other Corporation, (iii) purchase or otherwise acquire
all or substantially all of the properties and assets of this Corporation,
or (iv) undertake any similar extraordinary corporate transactions with
this Corporation, may in its discretion, in connection with the exercise of
its judgment in determining what is in the best interests of this
Corporation and its shareholders, give due consideration to: (aa) all
relevant factors, including without limitation the social, legal, and
economic effects on the employees, customers, suppliers, and other
constituencies of this Corporation and its subsidiaries, on the communities
and geographical areas in which this Corporation and its subsidiaries
operate or are located, and on any of the businesses and properties of this
Corporation or any of its subsidiaries, as well as such other factors as
the directors deem relevant; and (bb) all features of the consideration
being offered, not only in relation to the then current market price for
the Corporation's outstanding shares of capital stock, but also in relation
to the then current value of the Corporation in a freely negotiated
transaction and in relation to the Board of Director's estimate of the
future value of this Corporation (including the unrealized value of its
properties and assets) as an independent going concern.
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ISLANDS BANCORP
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f. Miscellaneous. Terms used herein which are not otherwise defined
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shall have the meanings ascribed to them in the Act. All references to
statutory provisions shall be deemed to include corresponding sections of
succeeding law. Each provision of these Articles of Incorporation shall be
deemed severable from, and shall survive the illegality or invalidity of,
any other provision herein.
6. Incorporator. The name, address and signature of each incorporator is as
follows:
Name Address Signature
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Martin Goodman 500-A Carteret Street ___________________________
Beaufort, SC 29902
7. Attorney's Certificate. I, William S. McMaster, an attorney licensed to
practice in the State of South Carolina, certify that the corporation, to
whose articles of incorporation this certificate is attached, has complied
with the requirements of Chapter 2 of the South Carolina Business
Corporation Act of 1988 as amended to date relating to the articles of
incorporation.
Date: July 15, 1999 /s/ WILLIAM S. MCMASTER
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William S. McMaster
NEXSEN PRUET JACOBS & POLLARD, LLP
P.O. Drawer 2426
Columbia, South Carolina 29202
(803) 771-8900
ARTICLES OF INCORPORATION
ISLANDS BANCORP
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