Exhibit 3.1
AMENDED AND RESTATED
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ARTICLES OF INCORPORATION
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OF REPUBLIC FIRST BANCORP, INC.
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REPUBLIC FIRST BANCORP, Inc., incorporated as a business
corporation pursuant to the Business Corporation Law of the Commonwealth of
Pennsylvania (Act of May 5, 1933, P.L. 364, as amended) on November 16, 1987
(the "Corporation"), wishing to amend and restate its Articles of Incorporation,
does hereby certify as follows:
ARTICLE I - NAME
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The name of the Corporation is REPUBLIC FIRST BANCORP, INC.
ARTICLE II - REGISTERED OFFICE
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The location and post office address of its registered office
in the Commonwealth of Pennsylvania is 1608 Walnut Street, Philadelphia,
Pennsylvania 19103.
ARTICLE III - PURPOSE
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The purpose for which the Corporation is incorporated is to
have unlimited power to engage in and to do any lawful act concerning any or all
lawful business for which a corporation may be incorporated under the provisions
of the Business Corporation Law of the Commonwealth of Pennsylvania.
The Corporation is incorporated pursuant to the provisions of
the Business Corporation Law of the Commonwealth of Pennsylvania (Act of May 5,
1933, P.L. 364, as amended).
ARTICLE IV - TERM
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The term for which the Corporation is to exist is perpetual.
ARTICLE V - CAPITAL STOCK
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The aggregate number of capital shares, which the Corporation
shall have authority to issue, shall be as follows:
A. 20,000,000 shares of Common Stock with a par value of $.01
per share.
B. 10,000,000 shares of Preferred Stock with a par value of
$.01 per share. The Board of Directors of the Corporation may authorize and
issue the unissued shares of Preferred Stock in one or more series by setting or
changing the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms or
conditions of redemption of the Preferred Stock. The Board may reclassify
unissued shares of any series. The authority of the Board of Directors shall
include the authority to determine the following provisions of the shares of
each series:
(1) the designation of such series and the number of
shares to constitute such series;
(2) whether the shares of such series shall have
voting rights, and, if so, the terms of such voting rights;
REPUBLIC FIRST BANCORP | 75
(3) the annual dividend rate, if any, payable on such
series, the conditions and dates upon which such dividends
shall be payable, the preference or relation which such
dividends shall bear to the dividends payable on any other
class or classes or any other series of the capital stock of
the Corporation and whether such dividends shall be cumulative
or noncumulative;
(4) whether the shares of such series shall be
redeemable at the option of the Corporation or the holder
thereof and, if redeemable, the times, prices and other terms
of such redemption;
(5) the amounts payable upon shares of such series
and the rights of the holders of such series upon liquidation,
dissolution or winding up of the Corporation;
(6) whether or not the shares of such series shall be
subject to the operation of a retirement or sinking fund, and,
if so, the extent to and manner in which any such retirement
or sinking funds shall be applied to the purchase or
redemption of the shares of such series for retirement or to
other corporate purposes and the terms and provisions relative
to the operation thereof;
(7) whether or not the shares of such series shall be
convertible into, or exchangeable for, shares of stock of any
other class or classes or of any other series of the same
class, and, if so convertible or exchangeable, the price or
prices or the rate or rates of conversion or exchange and the
method, if any, of adjusting the same;
(8) the limitations and restrictions, if any, to be
effective while any shares of such series are outstanding upon
the payment of dividends or making of other distributions on,
and upon the purchase, redemption or other acquisition by the
Corporation, of the Common Stock or any other class or classes
of stock of the Corporation ranking on a parity with or junior
to the shares of such series either as to dividends or upon
liquidation; and
(9) any other preferences, relative, participating,
optional or other rights and qualifications, limitations or
restrictions.
Except as otherwise provided by the Board of
Directors, all shares of Preferred Stock shall be of equal
rank and all shares of any one series shall be identical in
all of respects with all of the other shares of such series,
except that shares of any one series issued at different times
may differ as to the dates from which dividends thereon shall
be cumulative.
Prior to issuance of a series of Preferred Stock, the
Board of Directors may provide that the holders of the shares of the series of
Preferred Stock voting as a separate class may elect that number of directors as
determined by the Board of Directors at each annual meeting of shareholders of
the Corporation, whether upon default in the payment of any dividends payable
thereon or otherwise, and shall have the right to approve any amendment to the
charter which adversely affects the series of Preferred Stock.
C. All shares of Common Stock shall be identical with each
other in every respect. The Common Stock is subject to all the powers, rights,
privileges, preferences and priorities of the Preferred Stock as adopted by the
Board of Directors of the Corporation pursuant to authority granted to and
vested in it by the provisions of this Article FIVE. The shares of Common Stock
shall entitle the holders thereof to one vote for each share upon all matters
upon which shareholders
REPUBLIC FIRST BANCORP | 76
have the right to vote. Subject to the provisions of this Article FIVE and any
further provisions prescribed in accordance herewith, the holders of the Common
Stock shall be entitled to receive, when and as declared by the Board of
Directors, out of funds legally available for that purpose, dividends payable
either in cash, stock or otherwise.
D. Shares of stock may be issued in fractional shares. Any
fractional share shall carry proportionately the rights of a whole share
including, without limitation, the right to vote and the right to receive
dividends. A fractional share shall not, however, have the right to receive a
certificate evidencing it.
E. All persons who shall acquire stock in the Corporation
shall acquire same subject to the provisions of the Articles of Incorporation
and By-Laws of the Corporation.
F. The Board of Directors is expressly authorized, without the
assent or vote of the shareholders, to authorize the issuance from time to time
of shares of the stock of any class of the Corporation, whether now or hereafter
authorized, and securities convertible into shares of stock of the Corporation
of any class or classes, whether now or hereafter authorized, for such
consideration as the Board of Directors may deem advisable.
ARTICLE VI - NO PREEMPTIVE RIGHTS, NO CUMULATIVE VOTING
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A. No holder of shares of the Common Stock of the Corporation
shall have any preemptive or preferential right to subscribe for, purchase or
otherwise acquire or receive any shares of any class of stock hereafter issued
by the Corporation, whether now or hereafter authorized, or any shares of any
class of stock of the Corporation now or hereafter acquired and held by the
Corporation as treasury stock and subsequently reissued and sold or otherwise
disposed of, or any bonds, certificates of indebtedness, notes or any other
securities convertible into or exchangeable for, or any warrants or rights to
purchase or otherwise acquire, any shares of any class of stock of the
Corporation, whether now or hereafter authorized.
B. At each election of directors every shareholder entitled to
vote at such election shall have the right to vote the number of shares owned by
him for as many persons as there are directors to be elected and for whose
election he has a right to vote. Cumulative voting shall not be allowed.
ARTICLE VII - BOARD OF DIRECTORS
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A. At all Annual Meetings of shareholders commencing after the
Annual Meeting of Shareholders to be held in 1996, if any, any stockholder who
desires to propose nominees to the Board of Directors must provide for the
receipt of a written notice of the intention to nominate a person or persons for
election as directors by the Secretary of the Corporation: (i) with respect to
an election to be held at any annual meeting of shareholders in accordance with
the provision of Rule 14a-8, and (ii) with respect to an election to be held at
a special meeting of shareholders for the election of directors, the close of
business on the seventh (7th) day following the day on which notice of such
meeting is first given to shareholders.
The notice is required to contain: (i) the name and address of
the shareholder who intends to make the nomination and of the person or persons
to be nominated; (ii) a representation that the shareholder is a holder of
record of stock entitled to vote at the meeting and intends to appear in person
or by proxy at the meeting to nominate the person or persons specified in the
notice; (iii) a description of all arrangements or understandings between the
shareholder and each nominee and any other person or persons (naming such person
or persons) pursuant to which the nomination or nominations
REPUBLIC FIRST BANCORP | 77
are to be made by the shareholder; (iv) such other information regarding each
nominee proposed by such shareholder as would have been required to be included
in a proxy statement filed pursuant to the proxy rules of the Securities and
Exchange Commission had each nominee been nominated or intended to be nominated,
by the Board of Directors of the Corporation; and (v) the consent of each
nominee to serve as a director of the company if so elected. The chairman of any
meeting of shareholders to elect directors and the Board of Directors may refuse
to recognize the nomination of any person not made in compliance with the
foregoing.
ARTICLE VIII - BUSINESS COMBINATION
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A. Section 910 of the Pennsylvania Business Corporation Law
shall not be applicable to the Corporation.
B. The affirmative vote of the holders of not less than 75% of
the outstanding shares of "Voting Stock" held by the shareholders other than a
"Related Person" shall be required for the approval or authorization of any
"Business Combination" of the Corporation with any Related Person; provided,
however, that the 75% voting requirement shall not be applicable if:
(1) The "Continuing Directors" of the Corporation by
at least a two-thirds vote of such Continuing Directors have
expressly approved such Business Combination either in advance
of or subsequent to such Related Person having become a
Related Person; or
(2) The cash or fair market value (as determined by
at least two-thirds of the Continuing Directors) of the
property, securities or other consideration to be received per
share by holders of Voting Stock of the Corporation in the
Business Combination is not less than the "Highest Per Share
Price" or the "Highest Equivalent Price" paid by the Related
Person in acquiring any of its holdings of the Corporation's
Voting Stock.
C. For the purposes of this Article EIGHT:
(1) The term "Business Combination" shall mean (i)
any merger or consolidation of the Corporation or a subsidiary
of the Corporation with or into a Related Person, (ii) any
sale, lease, exchange, transfer or other disposition,
including without limitation a mortgage or any other security
device, or all or any "Substantial Part" of the assets either
of the Corporation (including without limitation any voting
securities of a subsidiary) or of a subsidiary of the
Corporation to a Related Person, (iii) any merger or
consolidation of a Related Person with or into the Corporation
or a subsidiary of the Corporation, (iv) any sale, lease,
exchange, transfer or other disposition, including without
limitation a mortgage or any other security device, of all or
any Substantial Part of the assets of a Related Person to the
Corporation or a subsidiary of the Corporation, (v) the
issuance of any securities of the Corporation or a subsidiary
of the Corporation to a Related Person other than the issuance
on a pro rata basis to all holders of shares of the same class
pursuant to a stock split or a stock dividend, or a
distribution of warrants or rights, (vi) any recapitalization
that would have the effect of increasing the voting power of a
Related Person, and (vii) any agreement, contract or other
arrangement providing for any of the transactions described in
this definition of Business Combination.
REPUBLIC FIRST BANCORP | 78
(2) The term "Related Person" shall mean and include
any individual, corporation, partnership or other person or
entity which, together with its "Affiliates" and "Associates,"
becomes the "Beneficial Owner" of an aggregate of 10% or more
of the outstanding Voting Stock of the Corporation, and any
Affiliates or Associate of any such individual, corporation,
partnership or other person or entity; provided, however, that
the term "Related Person" shall not include (i) a person or
entity whose acquisition of such aggregate percentage of
Voting Stock was approved in advance by two-third of the
Continuing Directors or (ii) any trustee or fiduciary when
acting in such capacity with respect to any employee benefit
plan of the Corporation or a wholly owned subsidiary of the
Corporation.
(3) The term "Substantial Part" shall mean an amount
equal to 10% or more of the fair market value as determined by
two-thirds of the Continuing Directors of the total
consolidated assets of the Corporation and its subsidiaries
taken as a whole as of the end of its most recent fiscal year
ended prior to the time the determination is being made.
(4) The term "Beneficial Owner" shall mean any person
(i) who beneficially owns shares of Voting Stock within the
meaning ascribed in Rule 13d-3 under the Securities Exchange
Act of 1934, as in effect on the date of adoption of this
Article EIGHT by the shareholders of the Corporation, or (ii)
who has the right to acquire Voting Shares (whether or not
such right is exercisable immediately) pursuant to any
agreement, contract, arrangement or understanding or upon the
exercise of conversion rights, exchange rights, warrants or
options, or otherwise.
(5) For purposes of subparagraph B(2) of this Article
EIGHT, the term "other consideration to be received" shall
include, without limitation, the value per share of Common
Stock or other capital stock of the Corporation retained by
its existing shareholders as adjusted to give effect to the
proposed Business Combination in the event of any Business
Combination in which the Corporation is a surviving
corporation.
(6) The term "Voting Stock" shall mean all of the
outstanding shares of Common Stock and the outstanding shares
of Preferred Stock entitled to vote on each matter on which
the holders of record of Common Stock shall be entitled to
vote, and each reference to a proportion of shares of Voting
Stock shall refer to such proportion of the votes entitled to
be cast by such shares.
(7) The term "Continuing Director" shall mean a
Director who was a member of the Board of Directors of the
Corporation immediately prior to the time that the Related
Person involved in a Business Combination became a Related
Person. As to any person who became a Related Person prior to
April 30, 1988, a Continuing Director shall mean a Director
who was a member of the Board of Directors on April 30, 1988.
(8) A Related Person shall be deemed to have acquired
a share of the Voting Stock of the Corporation at the time
when such Related Person became the Beneficial Owner thereof.
With respect to the shares owned by Affiliates, Associates or
other persons whose ownership is attributed to a Related
Person under the foregoing definition of Related Person, if
the price paid by such Related Person for such shares is not
determinable by two-thirds of the Continuing Directors, the
price so paid shall be deemed to
REPUBLIC FIRST BANCORP | 79
be the higher of (i) the price paid upon the acquisition
thereof by the Affiliate, Associate or other person or (ii)
the market price of the shares in question at the time when
the Related Person became the Beneficial Owner thereof.
(9) The terms "Highest Per Share Price" and "Highest
Equivalent Price" as used in this Article NINE shall mean the
following: If there is only one class of capital stock of the
Corporation issued and outstanding, the Highest Per Share
Price shall mean the highest price that can be determined to
have been paid at any time by the Related Person for any
shares or shares of that class of capital stock. If there is
more than one class of capital stock of the Corporation issued
and outstanding, the Highest Equivalent Price shall mean, with
respect to each class and series of capital stock of the
Corporation, the amount determined by two-thirds of the
Continuing Directors, on whatever basis they believe is
appropriate, to be the highest per share price equivalent of
the highest price that can be determined to have been paid at
any time by the Related Person for any share or shares of any
class or series of capital stock of the Corporation. In
determining the Highest Per Share Price and Highest Equivalent
Price, all purchases by the Related Person shall be taken into
account regardless of whether the shares were purchased before
or after the Related Person becomes a Related Person. Also,
the Highest Per Share Price and the Highest Equivalent Price
shall include any brokerage commissions, transfer taxes and
soliciting dealers' fees or other value paid by the Related
Person with respect to the shares of capital stock of the
Corporation acquired by the Related Person.
(10) The terms "Affiliate" and "Associate" shall have
the same meaning as in Rule 12b-2 under the Securities
Exchange Act of 1934 as in effect on the date of the adoption
of this Article EIGHT by the shareholders of the Corporation.
D. This Article EIGHT and any of the provisions thereof may
not be amended, altered, changed or repealed in any respect unless such action
is approved by the affirmative vote of the holders of not less than 75% of the
outstanding shares of Voting Stock of the Corporation at a meeting of the
shareholders duly called for the consideration of such amendment, alteration,
change or repeal; provided, however, that if there is a Related Person, such
action must also be approved by the affirmative vote of the holders of not less
than 75% of the outstanding shares of Voting Stock not held by any Related
Person.
ARTICLE IX - CONSTITUENCIES
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A. The Board of Directors may, if it deems it advisable,
oppose a tender, or other offer for the Corporation's securities, whether the
offer is in cash or in the securities of a corporation or otherwise. When
considering whether to oppose an offer, the Board of Directors may, but is not
legally obligated to, consider any pertinent issues; by way of illustration, but
not of limitation, the Board of Directors may, but shall not be legally
obligated to, consider any or all of the following:
(1) whether the offer price is acceptable based on
the historical and present operating results or financial
condition of the Corporation;
REPUBLIC FIRST BANCORP | 80
(2) whether a more favorable price could be obtained
for the Corporation's securities in the future;
(3) the impact which an acquisition of the
Corporation would have on the employees, depositors and
customers of the Corporation and its subsidiaries and the
community which they serve;
(4) the reputation and business practices of the
offeror and its management and affiliates as they would affect
the employees, depositors and customers of the Corporation and
its subsidiaries and the future value of the Corporation's
stock;
(5) the value of the securities (if any) which the
offeror is offering in exchange for the Corporation's
securities, based on an analysis of the worth of the
Corporation as compared to the corporation or other entity
whose securities are being offered;
(6) any antitrust or other legal and regulatory
issues that are raised by the offer.
B. If the Board of Directors determines that an offer should
be rejected, it may take any lawful action to accomplish its purpose including,
but not limited to, any or all of the following: advising shareholders not to
accept the offer; litigation against the offeror; filing complaints with all
governmental and regulatory authorities; acquiring the Corporation's securities;
selling or otherwise issuing authorized but unissued securities or treasury
stock or granting options with respect thereto; acquiring a company to create an
antitrust or other regulatory problem for the offeror; and obtaining a more
favorable offer from another individual or entity.
ARTICLE X - INDEMNIFICATION AND INSURANCE
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A. The corporation shall indemnify an indemnified
representative against any liability incurred in connection with any proceeding
in which the indemnified representative may be involved as a party or otherwise
by reason of the act that such person is or was serving in an indemnified
capacity, including, without limitation, liabilities resulting from any actual
or alleged breach or neglect of duty, error, misstatement or misleading
statement, negligence, gross negligence or act giving rise to strict or products
liability, except:
(1) where such indemnification is expressly
prohibited by applicable law;
(2) where the conduct of the indemnified
representative has been finally determined pursuant to
paragraph F or otherwise:
(i) to constitute willful misconduct or
recklessness within the meaning of 15 Pa.C.S. 513(b)
and 1746(b) or any superseding provision of law
sufficient in the circumstances to bar
indemnification against liabilities arising from the
conduct; or
(ii) to be based upon or attributable to the
receipt by the indemnified representative from the
corporation of a personal benefit to which the
indemnified representative is not legally entitled;
or
REPUBLIC FIRST BANCORP | 81
(iii) to the extent such indemnification has
been finally determined in a final adjudication
pursuant to paragraph F to be otherwise unlawful.
(3) with respect to expenses or the payment of
profits arising from the purchase or sale of securities of the
corporation in violation of Section 16(b) of the Securities
Exchange Act of 1934;
(4) expenses or liabilities of any type whatsoever
(including, but not limited to, judgments, fines and amounts
paid in settlement) which have been paid directly to or for
the benefit of, such person by directors' liability insurance
whose premiums are paid for by the corporation or by an
individual or entity other than such director or officer;
(5) amounts paid in settlement of any proceeding
without the written consent of the corporation or;
The Board of Directors of the corporation is hereby authorized, at any time by
resolution, to add to the above list of exceptions from the right of
indemnification, but any such additional exception shall not apply with respect
to any event, act or omission which has occurred prior to the date that the
Board of Directors in fact adopts such resolution. Any such additional exception
may, at any time after its adoption, be amended, supplemented, waived or
terminated by further resolution of the Board of Directors of the corporation.
If an indemnified representative is entitled to indemnification in respect of a
portion, but not all, of any liabilities to which such person may be subject,
the corporation shall indemnify such indemnified representative to the maximum
extent for such portion of the liabilities.
The termination of a proceeding by judgment, order, settlement or conviction or
upon a plea of nolo contendere or its equivalent shall not of itself create a
presumption that the indemnified representative is not entitled to
indemnification.
For purposes of this Article X:
(1) "indemnified capacity" means any and all past,
present and future service by an indemnified representative in
one or more capacities as a director, officer, employee or
agent of the corporation, or, at the request of the
corporation, as a director, officer, employee, agent,
fiduciary or trustee of another corporation, partnership,
joint venture, trust, employee benefit plan or other entity or
enterprise;
(2) "indemnified representative" means any and all
directors and officers of the corporation and any other person
designated as an indemnified representative by the Board of
Directors of the corporation (which may, but not, include any
person serving at the request of the corporation, as a
director, officer, employee, agent, fiduciary or trustee of
another corporation, partnership, joint venture, trust,
employee benefit plan or other entity or enterprise);
(3) "liability" means any damage, judgment, amount
paid in settlement, fine, penalty, punitive damages, excise
tax assessed with respect to an employee benefit plan, or cost
or expense, of any nature (including, without limitation
attorneys' fees and disbursements); and
(4) "proceeding" means any threatened, pending or
completed action, suit, appeal or other proceeding of any
nature, whether civil, criminal, administrative or
investigative, whether formal or
REPUBLIC FIRST BANCORP | 82
informal, and whether brought by or in the right of the
corporation, a class of its security holders or otherwise.
(5) "to the fullest extent permitted by applicable
law" means the maximum extent permitted by the public policy,
common law or statute. Any person covered by this Article X
may, to the fullest extent permitted by applicable law, elect
to have the right to indemnification or to advancement or
reimbursement of expenses, interpreted, at such person's
option (i) on the basis of the applicable law on the date this
Article X was approved by shareholders, or (ii) on the basis
of the applicable law in effect at the time of the occurrence
of the event or events giving rise to the proceeding, or (iii)
on the basis of the applicable law in effect at the time
indemnification or advancement or reimbursement of expenses is
sought.
(6) The corporation shall have the right to appoint
the attorney for an indemnified representative provided such
appointment is not unreasonable under the circumstances.
B. Notwithstanding any other provision of this Article X, the
corporation shall not indemnify under this Article X an indemnified
representative for any liability incurred in a proceeding initiated (which shall
not be deemed to include counterclaims or affirmative defenses) or participated
in as an intervenor or amicus curiae by the person seeking indemnification
unless such initiation of or participation in the proceeding is authorized,
either before or after its commencement, by the affirmative vote of a majority
of the directors in office. This section does not apply to a reimbursement of
expenses incurred in successfully prosecuting or defending an arbitration under
paragraph F or otherwise successfully prosecuting or defending the rights of an
indemnified representative granted by or pursuant to this Article X.
C. The corporation shall pay the expenses (including
attorneys' fees and disbursements) incurred in good faith by an indemnified
representative in advance of the final disposition of a proceeding described in
paragraph A or the initiation of or participation in which is authorized
pursuant to paragraph B upon receipt of an undertaking by or on behalf of the
indemnified representative to repay the amount if it is ultimately determined
pursuant to paragraph F that such person is not entitled to be indemnified by
the corporation pursuant to this Article X. The financial ability of an
indemnified representative to repay an advance shall not be a prerequisite to
making of such advance.
D. To further effect, satisfy or secure the indemnification
obligation provided herein or otherwise, the corporation may maintain insurance,
obtain a letter of credit, act as self-insurer, create a reserve, trust, escrow,
cash collateral or other fund or account, enter into indemnification agreements,
pledge or grant a security interest in any assets or properties of the
corporation, or use any other mechanism or arrangement whatsoever in such
amounts, at such costs, and upon such other terms and conditions as the Board of
Directors shall deem appropriate. Absent fraud, the determination of the Board
of Directors with respect to such amounts, costs, terms and conditions shall be
conclusive against all security holders, officers and directors and shall not be
subject to void ability.
E. An indemnified representative shall be entitled to
indemnification within thirty (30) days after a written request for
indemnification has been delivered to the Secretary of the corporation.
REPUBLIC FIRST BANCORP | 83
F. Any dispute related to the right to indemnification,
contribution or advancement of expenses as provided under this Article X, except
with respect to indemnification for liabilities arising under the Securities Act
of 1933 that the corporation has undertaken to submit to a court for
adjudication, shall be decided only by arbitration in the metropolitan area in
which the principal executive offices of the corporation are located at the
time, in accordance with the commercial arbitration rules then in effect of the
American Arbitration Association, before a panel of three arbitrators, one of
whom shall be selected by the corporation, the second of whom shall be selected
by the indemnified representative and third of whom shall be selected by the
other two arbitrators. In the absence of the American Arbitration Association,
or if for any reason arbitration under the arbitration rules of the American
Arbitration Association cannot be initiated, or if one of the parties fails or
refuses to select an arbitrator or if the arbitrators selected by the
corporation and the indemnified representative cannot agree on the selection of
the third arbitrator within thirty (30) days after such time as the corporation
and the indemnified representative have each been notified of the selection of
the other's arbitrator, the necessary arbitrator or arbitrators shall be
selected by the presiding judge of the court of general jurisdiction in such
metropolitan area.
The party or parties challenging the right of an indemnified
representative to the benefits of this Article X shall have the burden of proof.
The corporation shall reimburse an indemnified representative
for the expenses (including attorneys' fees and disbursements) incurred
unsuccessfully prosecuting or defending such arbitration.
Any award entered by the arbitrators shall be final, binding
and nonappealable and judgment may be entered thereon by any party in accordance
with applicable law in any court of competent jurisdiction, except that the
corporation shall be entitled to interpose as a defense in any such judicial
enforcement proceeding any prior final judicial determination adverse to the
indemnified representative in a proceeding not directly involving
indemnification under this Article X. This arbitration provision shall be
specifically enforceable.
G. If the indemnification provided for in this Article X or
otherwise is unavailable for any reason in respect of any liability or portion
thereof, the corporation shall contribute to the liabilities to which the
indemnified representative may be subject in such proportion as is appropriate
to reflect the intent of this Article X or otherwise.
H. To the extent that an authorized representative of the
corporation has been successful on the merits or otherwise in defense of any
action or proceeding referred to in 15 Pa.C.S. 1741 or 1742 or in defense of any
claim, issue or matter therein, such person shall be indemnified against
expenses (including attorneys' fees and disbursement) actually and reasonably
incurred by such person in connection therewith.
I. The corporation may, to the fullest extent permitted by
applicable law, indemnify and advance or reimburse expenses for, persons in all
situations other than that covered by this Article X.
J. All rights under this Article X shall be deemed a contract
between the corporation and the indemnified representative pursuant to which the
corporation and each indemnified representative intend to be legally bound. Any
repeal, amendment or modification hereof shall be prospective only and shall not
affect any rights or obligations then existing.
K. The rights granted by this Article X shall not be deemed
exclusive of any other rights to which those seeking indemnification,
contribution or advancement of expenses may be entitled under any statute,
agreement, vote
REPUBLIC FIRST BANCORP | 84
of shareholders or disinterested directors or otherwise both as to action in an
indemnified capacity and as to action in any other capacity. The
indemnification, contribution and advancement of expenses provided by or granted
pursuant to this Article X shall continue as to a person who has ceased to be an
indemnified representative in respect of matters arising prior to such time, and
shall inure to the benefit of the heirs, executors, administrators and personal
representatives of such a person.
L. Each person who shall act as an indemnified representative
of the corporation shall be deemed to be doing so in reliance upon the rights
provided in this Article X.
ARTICLE XI - AMENDMENTS
-----------------------
These Articles of Incorporation may be amended, subject to the
provisions of the laws of the Commonwealth of Pennsylvania, at any regular or
special meeting of the shareholders for which adequate notice has been given, by
the affirmative vote of the holders of outstanding shares of stock of the
Corporation representing a majority of the votes entitled to be cast; provided,
however, that Article V through Article XII, including this Article XI, may be
amended only by the affirmative vote of holders of outstanding shares
representing at least sixty percent (60%) of the votes entitled to be cast for
that purpose.
ARTICLE XII - OWNERSHIP LIMITATION
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A. Except as provided in paragraph B, no shareholder may have
Holdings (as defined in paragraph D of this Article) that exceed ten percent
(10%) of the issued and outstanding shares of common stock.
B. Upon the resolution of at least two-thirds of the Board of
Directors, the restriction imposed by paragraph A may be waived with respect to
the Holdings of any shareholders.
C. If any shareholder acquires Holdings which cause the
violation of the restriction contained in paragraph A, the Board of Directors
may (i) terminate all voting rights attributable to the Holdings of such
shareholder during the time that paragraph A is being violated; (ii) commence
litigation to require divestiture of such amount of the Holdings so that after
such divestiture the shareholder would no longer be in violation of the
restriction contained in paragraph A; or (iii) take such other action as is
appropriate under the circumstances.
D. Holdings mean (i) the common stock the shareholder owns of
record; (ii) the common stock to which the shareholder has direct or indirect
beneficial ownership (as such term is defined in Section 13(d) of the Securities
Exchange Act of 1934 and the regulations thereunder in effect on the date
hereof, "Section 13(d)"); and (iii) the common stock owned of record or
beneficially by other shareholder(s) acting together with the shareholder as a
group (as such term is defined in Section 13(d)) for the purpose of acquiring,
holding or disposing of common stock (a "Shareholder Group"). The Board of
Directors' determination of the existence and membership of a Shareholder Group,
of a shareholder's Holdings and of the record and beneficial ownership of common
stock shall be final and conclusive, absent proof of bad faith.
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