FEDERAL MHC SUBSIDIARY HOLDING COMPANY CHARTER

                                       FOR

                          CLIFTON SAVINGS BANCORP, INC.

 

 

                           SECTION 1. CORPORATE TITLE.

 

     The full corporate title of the MHC subsidiary holding company is Clifton

Savings Bancorp, Inc. (the "Holding Company").

 

                               SECTION 2. DOMICILE

 

     The domicile of the Holding Company is in the city of Clifton, in the State

of New Jersey.

 

                              SECTION 3. DURATION.

 

     The duration of the Holding Company is perpetual.

 

                         SECTION 4. PURPOSE AND POWERS.

 

     The purpose of the Holding Company is to pursue any or all of the lawful

objectives of a federal mutual holding company chartered under Section 10(o) of

the Home Owners' Loan Act, 12 U.S.C. 1467a(o), and to exercise all the express,

implied, and incidental powers conferred thereby and by all acts amendatory

thereof and supplemental thereto, subject to the Constitution and laws of the

United States as they are now in effect, or as they may hereafter be amended,

and subject to all lawful and applicable rules, regulations, and orders of the

Office of Thrift Supervision ("OTS").

 

                            SECTION 5. CAPITAL STOCK.

 

     The total number of shares of all classes of the capital stock which the

Holding Company has authority to issue is seventy-six million shares

(76,000,000), of which seventy-five million shares (75,000,000) shall be common

stock, par value $.01 per share, and of which one million shares (1,000,000)

shall be preferred stock, par value $.01 per share. The shares may be issued

from time to time as authorized by the Board of Directors without further

approval of shareholders except as otherwise provided in this Section 5 or to

the extent that such approval is required by governing law, rule, or regulation.

The consideration for the issuance of the shares shall be paid in full before

their issuance and shall not be less than the par value. Neither promissory

notes nor future services shall constitute payment or part payment for the

issuance of shares of the Holding Company. The consideration for the shares

shall be cash, tangible or intangible property (to the extent direct investment

in such property would be permitted), labor, or services actually performed for

the Holding Company, or any combination of the foregoing. In the absence of

actual fraud in the transaction, the value of such property, labor, or services,

as

 

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determined by the Board of Directors of the Holding Company, shall be

conclusive. Upon payment of such consideration, such shares shall be deemed to

be fully paid and nonassessable. In the case of a stock dividend, that part of

the retained earnings of the Holding Company that is transferred to common stock

or paid-in capital accounts upon the issuance of shares as a stock dividend

shall be deemed to be the consideration for their issuance.

 

     Except for the initial offering of shares of the Holding Company, no shares

of capital stock (including shares issuable upon conversion, exchange, or

exercise of other securities) shall be issued, directly or indirectly, to

officers, directors, or controlling persons of the Holding Company other than as

part of a general public offering or as qualifying shares to a director, unless

their issuance or the plan under which they would be issued has been approved by

a majority of the total votes eligible to be cast at a legal meeting.

 

     Nothing contained in this Section 5 (or in any supplementary sections

hereto) shall entitle the holders of any class or series of capital stock to

vote as a separate class or series or to more than one vote per share: provided,

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that this restriction on voting separately by class or series shall not apply:

 

      (i)   To any provision which would authorize the holders of preferred

            stock, voting as a class or series, to elect some members of the

            Board of Directors, less than a majority thereof, in the event of

            default in the payment of dividends on any class or series of

            preferred stock;

 

      (ii)  To any provision which would require the holders of preferred stock,

            voting as a class or series, to approve the merger or consolidation

            of the Holding Company with another corporation or the sale, lease,

            or conveyance (other than by mortgage or pledge) of properties or

            business in exchange for securities of a corporation other than the

            Holding Company if the preferred stock is exchanged for securities

            of such other corporation; provided, that no provision may require

            such approval for transactions undertaken with the assistance or

            pursuant to the direction of the OTS or the Federal Deposit

            Insurance Corporation;

 

      (iii) To any amendment which would adversely change the specific terms of

            any class or series of capital stock as set forth in this Section 5

            (or in any supplementary sections hereto), including any amendment

            which would create or enlarge any class or series ranking prior

            thereto in rights and preferences. An amendment which increases the

            number of authorized shares of any class or series of capital stock,

            or substitutes the surviving Holding Company in a merger or

            consolidation for the Holding Company, shall not be considered to be

            such an adverse change.

 

     A description of the different classes and series (if any) of the Holding

Company's capital stock and a statement of the designations, and the relative

rights, preferences, and limitations of the shares of each class of and series

(if any) of capital stock are as follows:

 

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      A.    Common Stock. Except as provided in this Section 5 (or in any

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            supplementary sections thereto) 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 holder and there shall be no right to cumulate votes in an

            election of directors.

 

            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 of sinking fund, or

            retirement fund, or other retirement payments, if any, to which such

            holders are respectively entitled in preference to the common stock,

            then dividends may be paid on the common stock and on any class or

            series of stock entitled to participate therewith as to dividends

            out of any assets legally available for the payment of dividends.

 

            In the event of any liquidation, dissolution, or winding up of the

            Holding Company, the holders of the common stock (and the holders of

            any class or series of stock entitled to participate with the common

            stock in the distribution of assets) shall be entitled to receive,

            in cash or in kind, the assets of the Holding Company available for

            distribution remaining after: (i) payment or provision for payment

            of the Holding Company's debts and liabilities; (ii) distributions

            or provision for distributions in settlement of a liquidation

            account; and (iii) distributions or provision for distributions to

            holders of any class or series of stock having preference over the

            common stock in the liquidation, dissolution, or winding up of the

            Holding Company. Each share of common stock shall have the same

            relative rights as and be identical in all respects with all the

            other shares of common stock.

 

      B.    Preferred Stock.  The Holding Company may provide in supplementary

            ---------------

            sections to its charter for one or more classes of preferred stock,

            which shall be separately identified. The shares of any class may be

            divided into and issued in series, with each series separately

            designated so as to distinguish the shares thereof from the shares

            of all other series and classes. The terms of each series shall be

            set forth in a supplementary section to the charter. All shares of

            the same class shall be identical except as to the following

            relative rights and preferences, as to which there may be variations

            between different series:

 

            (a)   The distinctive serial designation and the number of shares

                  constituting such series;

 

            (b)   The dividend rate or the amount of dividends to be paid on the

                  shares of such series, whether dividends shall be cumulative

                  and, if so, from which date(s) the payment date(s) for

                  dividends, and the participating or other special rights, if

                  any, with respect to dividends;

 

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            (c)   The voting powers, full or limited, if any, of the shares of

                  such series;

 

            (d)   Whether the shares of such series shall be redeemable and, if

                  so, the price(s) at which, and the terms and conditions on

                  which, such shares may be redeemed;

 

            (e)   The amount(s) payable upon the shares of such series in the

                  event of voluntary or involuntary liquidation, dissolution, or

                  winding up of the Holding Company;

 

            (f)   Whether the shares of such series shall be entitled to the

                  benefit of a sinking or retirement fund to be applied to the

                  purchase or redemption of such shares, and if so entitled, the

                  amount of such fund and the manner of its application,

                  including the price(s) at which such shares may be redeemed or

                  purchased through the application of such fund;

 

            (g)   Whether the shares of such series shall be convertible into,

                  or exchangeable for, shares of any other class or classes of

                  stock of the Holding Company and, if so, the conversion

                  price(s) or the rate(s) of exchange, and the adjustments

                  thereof, if any, at which such conversion or exchange may be

                  made, and any other terms and conditions of such conversion or

                  exchange;

 

            (h)   The price or other consideration for which the shares of such

                  series shall be issued; and

 

            (i)   Whether the shares of such series which are redeemed or

                  converted shall have the status of authorized but unissued

                  shares of serial preferred stock and whether such shares may

                  be reissued as shares of the same or any other series of

                  serial preferred stock.

 

     Each share of each series of serial preferred stock shall have the same

relative rights as and be identical in all respects with all the other shares of

the same series.

 

     The Board of Directors shall have authority to divide, by the adoption of

supplementary charter sections, any authorized class of preferred stock into

series, and, within the limitations set forth in this section and the remainder

of this charter, fix and determine the relative rights and preferences of the

shares of any series so established.

 

     Prior to the issuance of any preferred shares of a series established by a

supplementary charter section adopted by the Board of Directors, the Holding

Company shall file with the Secretary to the OTS a dated copy of that

supplementary section of this charter establishing and designating the series

and fixing and determining the relative rights and preferences thereof.

 

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           SECTION 6. CERTAIN PROVISIONS APPLICABLE FOR FIVE YEARS.

 

     Notwithstanding anything contained in the Holding Company's charter or

bylaws to the contrary, for a period of five years from the date of an initial

minority stock offering of shares of common stock of the Holding Company, the

following provisions shall apply:

 

      A.    Beneficial Ownership Limitation.  No person other than Clifton MHC

            -------------------------------

            shall directly or indirectly offer to acquire or acquire the

            beneficial ownership of more than 10 percent of any class of any

            equity security of the Holding Company. This limitation shall not

            apply to a transaction in which the Holding Company forms a holding

            company in conjunction with conversion, or thereafter, if such

            formation is without change in the respective beneficial ownership

            interests of the Holding Company's shareholders other than pursuant

            to the exercise of any dissenter and appraisal rights, the purchase

            of shares by underwriters in connection with a public offering, or

            the purchase of shares by a tax-qualified employee stock benefit

            plan which is exempt from the approval requirements under Section

            574.3(c)(1)(vi) of the OTS's Regulations.

 

            In the event shares are acquired in violation of this Section 6, all

            shares beneficially owned by any person in excess of 10% shall be

            considered "excess shares" and shall not be counted as shares

            entitled to vote and shall not be voted by any person or counted as

            voting shares in connection with any matters submitted to the

            shareholders for a vote.

 

     For the purposes of this Section 6, the following definitions apply:

 

            (i)   The term "person" includes an individual, a group acting in

                  concert, a corporation, a partnership, an association, a joint

                  stock company, a trust, any unincorporated organization or

                  similar company, a syndicate or any other group formed for the

                  purpose of acquiring, holding or disposing of the equity

                  securities of the Holding Company.

 

            (ii)  The term "offer" includes every offer to buy or otherwise

                  acquire, solicitation of an offer to sell, tender offer for,

                  or request or invitation for tenders of, a security or

                  interest in a security for value.

 

            (iii) The term "acquire" includes every type of acquisition, whether

                  effected by purchase, exchange, operation of law or otherwise.

 

            (iv)  The term "acting in concert" means (a) knowing participation

                  in a joint activity or conscious parallel action towards a

                  common goal whether or not pursuant to an express agreement,

                  or (b) a combination or pooling of voting or other interests

                  in the securities of an issuer for a common

 

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                  purpose pursuant to any contract, understanding, relationship,

                  agreement or other arrangement, whether written or otherwise.

 

      B.    Call for Special Meetings. Special meetings of shareholders relating

            -------------------------

            to changes in control of the Holding Company or amendments to its

            charter shall be called only at the direction of the Board of

            Directors.

 

                          SECTION 7. PREEMPTIVE RIGHTS.

 

     Holders of the capital stock of the Holding Company are not entitled to

preemptive rights with respect to any shares of the Holding Company that may be

issued.

 

                              SECTION 8. DIRECTORS.

 

     The Holding Company shall be under the direction of a Board of Directors.

The authorized number of directors, as stated in the Holding Company's bylaws,

shall be not be fewer than five nor more than 15 except when a greater or lesser

number is approved by the Director of the OTS, or his or her delegate.

 

                        SECTION 9. AMENDMENT OF CHARTER.

 

     Except as provided in Section 5, no amendment, addition, alteration,

change, or repeal of this charter shall be made, unless such is proposed by the

Board of Directors of the Holding Company, approved by the shareholders by a

majority of the votes eligible to be cast at a legal meeting, unless a higher

vote is otherwise is required, and approved or preapproved by the OTS.

 

 

 

 

 

 

 

 

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                                          CLIFTON SAVINGS BANCORP, INC.

 

 

 

Attest: /s/ Walter Celuch                 By: /s/ John A. Celentano, Jr.

        -------------------------             ---------------------------------

        Walter Celuch                         John A. Celentano, Jr.

        Corporate Secretary                   Chairman of the Board and Chief

                                              Executive Officer

 

 

 

 

 

                                          OFFICE OF THRIFT SUPERVISION

 

 

 

Attest: /s/ Nadine Y. Washington          By: /s/ James E. Gilleran

        ----------------------------          -----------------------------

        Corporate Secretary to the OTS        James E. Gilleran

                                              Director

 

 

Declared effective on

the 3rd day of March, 2004

 

[As Filed: 06-29-2004]