ARTICLES OF INCORPORATION

 

                                       OF

 

                      SANDY SPRING MARYLAND BANCORP, INC.

 

 

     The undersigned, Willard H. Derrick, whose address is 17801 Georgia Avenue,

Olney, Maryland 20832, being at least 18 years of age, acting as incorporator,

does hereby form a corporation under the General Laws of the State of Maryland

having the following Articles of Incorporation:

 

                                   ARTICLE I

 

                                      Name

 

     The name of the corporation is Sandy Spring Maryland Bancorp, Inc. (herein

the "Corporation").

 

                                   ARTICLE II

 

                                    Purposes

 

     The purposes for which the Corporation is organized are to exercise all

powers of a bank holding company registered with the Board of Governors of the

Federal Reserve System under the Bank Holding Company Act of 1956, as amended,

and to engage in any and all activities allowed for such a bank holding company

under federal law and the General Laws of the State of Maryland.  The

Corporation shall have all the powers of a corporation organized under the

General Laws of the State of Maryland.

 

                                  ARTICLE III

 

                                Principal Office

 

     The address of the Corporation's principal office in the State of Maryland

is 17801 Georgia Avenue, Olney, Maryland 20832.

 

                                   ARTICLE IV

 

                                 Resident Agent

 

     The name and address of the resident agent of the Corporation in the State

of Maryland are Willard H. Derrick, 17801 Georgia Avenue, Olney, Maryland 20832.

The resident agent is a citizen of the State of Maryland and actually resides

therein.

 

                                   ARTICLE V

 

                                 Capital Stock

 

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

Corporation has authority to issue is 6,000,000 shares of capital stock, $1.00

par value per share, amounting in aggregate par value to $6,000,000.  All of

such shares are initially classified as common stock.  The Board of Directors

may classify and reclassify any unissued shares of capital stock by setting or

changing in any one or more respects the preferences, conversion or other

rights, voting powers, restrictions, limitations as to distributions and

dividends, qualifications or terms or

 

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conditions of redemption of such shares of stock.  The consideration for the

issuance of the shares shall be paid to or received by the Corporation in full

before their issuance and shall not be less than the par value per share.  The

consideration for the issuance of the shares, other than cash, shall be

determined by the Board of Directors in accordance with the General Laws of the

State of Maryland.  In the absence of actual fraud in the transaction, the

judgment of the Board of Directors as to the value of such consideration 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, the part

of the surplus of the Corporation which is transferred to stated capital upon

the issuance of shares as a stock dividend shall be deemed to be the

consideration for their issuance.

 

     Common Stock.  The following is a description of the preferences,

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

conversion and other rights, voting powers, restrictions, limitations as to

dividends, qualifications and terms and conditions of redemption of the common

stock of the Corporation:

 

     (1)  Each share of common stock shall have one vote, and, except as

otherwise provided in respect of any class of stock hereafter classified or

reclassified, the holders of the common stock shall exclusively possess all

voting power.

 

     (2)  Whenever there shall have been paid, or declared and set aside for

payment, to the holders of the outstanding shares of any class of stock having

preference over the common stock as to the payment of dividends, the full amount

of dividends and sinking fund or retirement fund or other retirement payments,

if any, to which such holders are respectively entitled in preference to the

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

or series of stock entitled to participate therewith as to dividends, out of any

assets legally available for the payment of dividends, but only as declared by

the Board of Directors.

 

     (3)  In the event of any liquidation, dissolution or winding up of the

Corporation, after there shall have been paid, or declared and set aside for

payment, to the holders of the outstanding shares of any class having preference

over the common stock in any such event, the full preferential amounts to which

they are respectively entitled, the holders of the common stock and of any class

or series of stock entitled to participate therewith, in whole or in part, as to

distribution of assets shall be entitled, after payment or provision for payment

of all debts and liabilities of the Corporation, to receive the remaining assets

of the Corporation available for distribution, in cash or in kind.

 

     (4)  Each share of common stock shall have the same relative powers,

preferences and rights as, and shall be identical in all respects with, all the

other shares of common stock of the Corporation.

 

     Serial Preferred Stock.  Subject to the foregoing, the power of the Board

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

of Directors to classify and reclassify any of the shares of capital stock shall

include, without limitation, authority to classify or reclassify any unissued

shares of such stock into a class or classes of preferred stock or other stock,

and to divide and classify shares of any class into one or more series of such

class, by determining, fixing, or altering one or more of the following:

 

     (1) the distinctive designation and the number of shares constituting such

class or series; provided that, unless otherwise prohibited by the terms of such

or any other class or series, the number of shares of any class or series may be

decreased by the Board of Directors in connection with any classification or

reclassification of unissued shares and the number of shares of such class or

series may be increased by the Board of Directors in connection with any such

classification or reclassification, and any shares of any class or series that

have been redeemed, purchased, otherwise acquired or converted into shares of

common stock or any other class or series shall become part of the authorized

capital stock of the Corporation and be subject to classification and

reclassification as provided in this paragraph;

 

     (2) whether or not and, if so, the rates, amounts and times at which, and

the conditions under which, distributions and dividends shall be payable on

shares of such class or series, whether any such distributions and

 

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dividends shall rank senior or junior to or on a parity with the distributions

and dividends payable on any other class or series of stock, and the status of

any such distributions and dividends as cumulative, cumulative to a limited

extent or non-cumulative and as participating or non-participating; provided,

however, that the Corporation's indebtedness to a shareholder incurred by reason

of a distribution shall be on a parity with the Corporation's indebtedness to

its general unsecured creditors, except to the extent subordinated by agreement;

 

     (3) whether or not shares of such class or series shall have voting

rights, in addition to any voting rights provided by law and, if so, the terms

of such voting rights;

 

     (4) whether the shares of such class or series shall be redeemable and, if

so, the price or prices at which, and the terms and conditions upon which, such

shares may be redeemed;

 

     (5) the amount or amounts payable upon the shares of such class or series

in the event of voluntary or involuntary liquidation, dissolution or winding up

of the Corporation;

 

     (6) whether the shares of such class or series shall be entitled to the

benefits 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 or prices at which such shares

may be redeemed or purchased through the application of such funds;

 

     (7) whether the shares of such class or series shall be convertible into,

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

the same or any other class or classes of stock of the Corporation and, if so

convertible or exchangeable, the conversion price or prices, or the rate or

rates 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;

 

     (8) the subscription or purchase price and form of consideration for which

the shares of such class or series shall be issued;

 

     (9) the status of the shares of such class or series which are redeemed or

converted and whether such shares may be reissued as shares of the same or any

other class or series; and

 

     (10) any other preferences, rights, restrictions, including restrictions

on transferability, and qualifications of shares of such class or series, not

inconsistent with law and these Articles.

 

                                   ARTICLE VI

 

                       Authorization of Issuance of Stock

 

     The shares of capital stock of the Corporation may be issued from time to

time as authorized by the Board of Directors without the approval of the

shareholders except to the extent that such approval is required by governing

law, rule or regulation.  Such authorization by the Board of Directors may be

made by a majority or such other vote of the Board of Directors as may be

provided in the Corporation's Bylaws.

 

                                  ARTICLE VII

 

                               Preemptive Rights

 

     No holder of any stock or any other securities of the Corporation, whether

now or hereafter authorized, shall have any preemptive right to subscribe for or

purchase any stock or any other securities of the Corporation other than such,

if any, as the Board of Directors, in its sole discretion, may determine and at

such price or prices and upon such other terms as the Board of Directors, in its

sole discretion, may fix; and any stock or other securities which

 

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the Board of Directors may determine to offer for subscription may, as the Board

of Directors shall, in its sole discretion, determine, be offered to the holders

of any class, series or type of stock or other securities at the time

outstanding to the exclusion of the holders of any or all other classes, series

or types of stock or other securities at the time outstanding.

 

                                  ARTICLE VIII

 

                  Meetings of Shareholders; Cumulative Voting

 

     A.  Special meetings of the shareholders of the Corporation for any purpose

or purposes may be called at any time by the Board of Directors, by a committee

of the Board of Directors that has been duly designated by the Board, or in

accordance with the Corporation's Bylaws.

 

     B.  There shall be no cumulative voting by shareholders of any class or

series in the election of directors of the Corporation.

 

                                   ARTICLE IX

 

                                   Directors

 

     A.  Number.  The initial number of directors of the Corporation shall be

         ------                                                              

eleven (11), which number may be increased or decreased from time to time by

vote of the Board of Directors pursuant to the Corporation's Bylaws, but shall

never be  less than the minimum number permitted by the General Laws of the

State of Maryland now or hereafter in force or greater than fifteen (15)

(exclusive of directors, if any, to be elected by holders of preferred stock of

the Corporation, voting separately as a class).

 

     B.  Classified Board.  The Board of Directors of the Corporation shall be

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

divided into three classes as nearly equal in number as the then total number of

directors constituting the entire Board of Directors shall permit, which classes

shall be designated Class I, Class II and Class III.  At each annual meeting of

shareholders beginning in 1992, successors to the class of directors whose term

expires at such annual meeting shall be elected for a term of three years.

 

         (1)   The following directors shall be assigned to Class I and shall

serve until the 1994 annual meeting of shareholders:

 

     Andrew N. Adams, Jr.

     Robert L. Mitchell

     Robert L. Orndorff, Jr.

 

         (2)   The following directors shall be assigned to Class II and shall

serve until the 1993 annual meeting of shareholders:

 

     William M. Canby

     John Chirtea

     Willard H. Derrick

     Hunter R. Hollar

 

         (3)   The following directors shall be assigned to Class III and shall

serve until the 1992 annual meeting of shareholders.

 

     Charles F. Mess

     Louisa W. Riggs

     Francis Snowden

 

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     W. Drew Stabler

 

     Notwithstanding the foregoing, a director whose term shall expire at any

annual meeting shall continue to serve until such time as his successor shall

have been duly elected and shall have qualified unless his position on the Board

of Directors shall have been abolished by action taken to reduce the size of the

Board of Directors prior to said meeting.

 

     Should the number of directors of the Corporation be reduced, the

directorship(s) eliminated shall be allocated among classes as appropriate so

that the number of directors in each class is as nearly equal as possible.  The

Board of Directors shall designate, by the name of the incumbent(s), the

position(s) to be abolished.  Notwithstanding the foregoing, no decrease in the

number of directors shall have the effect of shortening the term of any

incumbent director.  Should the number of directors of the Corporation be

increased, the additional directorships shall be allocated among classes as

appropriate so that the number of directors in each class is as nearly equal as

possible.

 

     Whenever the holders of any one or more series of preferred stock of the

Corporation shall have the right, voting separately as a class, to elect one or

more directors of the Corporation, the Board of Directors shall consist of said

directors so elected in addition to the number of directors fixed as provided

above in this Article IX.  Notwithstanding the foregoing, and except as

otherwise may be required by applicable law, whenever the holders of any one or

more series of preferred stock of the Corporation shall have the right, voting

separately as a class, to elect one or more directors of the Corporation, the

terms of the director or directors elected by such holders shall expire at the

next succeeding annual meeting of shareholders.

 

                                   ARTICLE X

 

                              Removal of Directors

 

     Subject to applicable provisions of federal law and the rights of the

holders of any class separately entitled to elect one or more directors, any

director or the entire Board of Directors of the Corporation may be removed, at

any time, but only for cause and only by the affirmative vote of the holders of

a majority of the outstanding shares of capital stock of the Corporation

entitled to vote generally in the election of directors (considered for this

purpose as one class) cast at a meeting of the shareholders called for that

purpose.  For purposes of this Article X, "cause" is defined as final conviction

of a felony, unsound mind, adjudication of bankruptcy, non-acceptance of office

or conduct prejudicial to the interests of the Corporation.  A director may only

be removed by vote of shareholders after service of specific charges, adequate

notice, and full opportunity to refute the charges.

 

                                   ARTICLE XI

 

                      Vacancies in the Board of Directors

 

     Subject to the rights of the holders of any class separately entitled to

elect one or more directors, any vacancy occurring in the Board of Directors may

be filled by the affirmative vote of a majority of the directors then in office,

whether or not a quorum, or by the affirmative vote of the holders of a majority

of the outstanding shares of capital stock of the Corporation entitled to vote

generally in the election of directors.  A director so chosen by shareholders

shall hold office for the remainder of the term of the class to which the

director is assigned.  A director elected by the Board of Directors to fill a

vacancy resulting from the removal of a director shall hold office for the

remainder of the term of the removed director.  A director elected by the Board

of Directors to fill a vacancy resulting from any cause other than removal of a

director shall hold office for a term expiring at the following annual meeting

of shareholders.

 

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                                  ARTICLE XII

 

                        Approval of Certain Transactions

 

     The affirmative vote of the holders of not less than eighty percent (80%)

of the outstanding shares of voting stock of the Corporation is required to

authorize (a) a merger or consolidation of the Corporation with, or (b) a sale,

exchange or lease of all or substantially all of the assets of the Corporation

to, any person or entity unless approval of any transaction enumerated in

clauses (a) or (b) above is recommended by at least a majority of the entire

Board of Directors.  For purposes of this Article XII, "substantially all of the

assets" shall mean assets having a fair market value or book value, whichever is

greater, of twenty-five percent (25%) or more of the total assets of the

Corporation as reflected on a balance sheet of the Corporation as of a date no

earlier than forty-five (45) days prior to any acquisition of such assets.

 

                                  ARTICLE XIII

 

           Approval of Business Combinations with Controlling Parties

 

     The shareholder vote required to approve Business Combinations (as

hereinafter defined) with Controlling Parties (as hereinafter defined) shall be

as set forth in this Article XIII.

 

             A.    (1)  Except as otherwise expressly provided in this Article

     XIII, the affirmative vote of the holders of not less than eighty percent

     (80%) of the outstanding shares of all voting stock of the Corporation and

     the affirmative vote of the holders of not less than sixty-seven percent

     (67%) of the outstanding shares of voting stock of the Corporation not

     including shares deemed beneficially owned by a Controlling Party (as

     hereinafter defined), shall be required in order to authorize any of the

     following transactions, if any such transactions involves a Controlling

     Party:

 

                   (a)   any merger or consolidation of the Corporation;

 

                   (b)   any sale, lease, exchange, transfer or other

          disposition, including without limitation, a mortgage, or any other

          security device, of all or substantially any of the assets of the

          Corporation (as defined in Article XII of these Articles);

 

                   (c)   any reverse stock split involving the common stock of

          the Corporation; and

 

                   (d)   any agreement, contract or other arrangement providing

          for any of the transactions described in this Article XIII.

 

               (2)   The term "Business Combination" as used in this Article

     XIII shall mean any transaction which is referred to in any one or more of

     subparagraphs (a) through (d) above.

 

             B.    The provisions of Part A of this Article XIII shall not be

     applicable to any particular Business Combination, and such Business

     Combination shall require only such affirmative vote as is required by any

     other provision of these Articles, any provision of law, or any agreement

     with any regulatory agency or national securities exchange, if all of the

     conditions specified in either of the following paragraphs (1) and (2) are

     met with respect to such Business Combination:

 

               (1)   The Business Combination shall have been approved by a

     majority of the Continuing Directors (as hereinafter defined) at a meeting

     at which a Continuing Director Quorum (as hereinafter defined) is present.

 

               (2)   All of the following conditions shall have been met:

 

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                   (a)   The aggregate amount of (x) cash and (y) fair market

               value (as determined by the Continuing Directors in good faith)

               as of the date of the consummation of any Business Combination of

               consideration other than cash, to be received per share by

               holders of Common Stock in such Business Combination shall be at

               least equal to the highest amount determined under clauses (i),

               (ii) and (iii) below:

 

                         (i)   (if applicable) the highest per share price

                    (including any brokerage commissions, transfer taxes and

                    soliciting dealers' fees) paid by the Controlling Party for

                    any share of Common Stock acquired by it (A) within the

                    three-year period immediately prior to the first public

                    announcement of the proposal of the Business Combination

                    (the "Announcement Date") or (B) in the transaction in which

                    it became a Controlling Party, whichever is higher;

 

                         (ii)   the fair market value (as determined by the

                    Continuing Directors in good faith) per share of Common

                    Stock on the Announcement Date or on the date on which the

                    Controlling Party became a Controlling Party, whichever is

                    higher; and

 

                         (iii)   (if applicable) the price per share equal to

                    the fair market value (as determined by the Continuing

                    Directors in good faith) per share of Common Stock

                    determined pursuant to clause (2)(a)(ii) above, multiplied

                    by the ratio of (1) the highest per share price (including

                    any brokerage commissions, transfer taxes and soliciting

                    dealers' fees) paid by the Controlling Party for any shares

                    of Common Stock acquired by it within the three-year period

                    immediately prior to the Announcement Date to (2) the total

                    shareholder's equity per share of common stock (determined

                    in accordance with generally accepted accounting principles)

                    on the first day in such three-year period on which the

                    Controlling Party acquired any shares of Common Stock.

 

                    (b) The aggregate amount of (x) cash and (y) fair market

               value (as determined by the Continuing Directors in good faith)

               as of the date of the consummation of any Business Combination of

               consideration other than cash to be received per share by holders

               of shares of any class or series of outstanding preferred stock

               shall be at least equal to the highest amount determined under

               clauses (i), (ii), (iii) and (iv) below:

 

                         (i)   (if applicable) the highest per share price

                    (including any brokerage commissions, transfer taxes and

                    soliciting dealers' fees) paid by the Controlling Party for

                    any shares of such class or series of preferred stock

                    acquired by it (1) within the three-year period immediately

                    prior to the Announcement Date or (2) in the transaction in

                    which it became a Controlling Party, whichever is higher;

 

                         (ii)  the highest preferential amount per share to

                    which the holders of shares of such class or series of

                    Preferred Stock would be entitled in the event of any

                    voluntary or involuntary liquidation, dissolution or winding

                    up of the affairs of the Corporation regardless of whether

                    the Business Combination to be consummated constitutes such

                    an event;

 

                         (iii)  the fair market value (as determined by the

                    Continuing Directors in good faith) per share of such class

                    or series of preferred stock on the Announcement Date or on

                    the date on which the Controlling Party became a Controlling

                    Party, whichever is higher; and

 

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                         (iv)  (if applicable) the price per share equal to the

                    fair market value (as determined by the Continuing Directors

                    in good faith) per share of such class or series of

                    preferred stock determined pursuant to clause (2)(b)(iii)

                    above, multiplied by the ratio of (A) the highest per share

                    price (including any brokerage commissions, transfer taxes

                    and soliciting dealers' fees) paid by the Controlling Party

                    for any shares of such class or series of preferred stock

                    acquired by it within the three-year period immediately

                    prior to the Announcement Date to (B) the fair market value

                    (as determined by the Continuing Directors in good faith)

                    per share of such class or series of preferred stock on the

                    first day in such three-year period upon which the

                    Controlling Party acquired any shares of such class or

                    series of preferred stock.

 

                    The provisions of this sub-paragraph 2(b) shall be required

                    to be met with respect to every class or series of

                    outstanding preferred stock of the Corporation, whether or

                    not the Controlling Party has previously acquired any shares

                    of a particular class or series of preferred stock.

 

          C.   For the purposes of this Article XIII, the following definitions

     apply:

 

              (1)   The term "Controlling Party" shall mean and include (a) any

     individual, corporation, partnership or other person or entity that

     together with its "affiliates" (as that term is defined in Rule 12b-2 of

     the General Rules and Regulations under the Securities Act of 1934),

     "beneficially owns" (as that term is defined in Rule 13d-3 of the General

     Rules and Regulations under the Securities Exchange Act of 1934) in the

     aggregate twenty percent (20%) or more of the outstanding shares of the

     common stock of the Corporation; and (b) any "affiliate" (as that term is

     defined in Rule 12b-2 under the Securities Exchange Act of 1934) of any

     such individual, corporation, partnership or other person or entity.

     Without limitation, any shares of the common stock of the Corporation which

     any Controlling Party has the right to acquire pursuant to any agreement,

     or upon exercise of conversion rights, warrants or options, or otherwise,

     shall be deemed "beneficially owned" by such Controlling Party.

 

              (2)   The term "Continuing Director" shall mean any member of the

     Board of Directors of the Corporation who is not a Controlling Party or in

     any manner affiliated or associated with or a representative of the

     Controlling Party and was a member of the Board of Directors prior to the

     time that the Controlling Party became a Controlling Party, and any

     successor of a Continuing Director who is unaffiliated with the Controlling

     Party and is recommended to succeed a Continuing Director by a majority of

     Continuing Directors then on the Board.

 

              (3)   The term "Continuing Director Quorum" shall mean two-thirds

     of the Continuing Directors capable of exercising the powers conferred on

     them.

 

                                  ARTICLE XIV

 

                      Evaluation of Business Combinations

 

     The Board of Directors of the Corporation shall consider all factors it

deems relevant in evaluating any proposed tender offer or exchange offer for the

stock of the Corporation or any subsidiary, any proposed merger or consolidation

of the Corporation or a subsidiary with or into another entity and any proposal

to purchase or otherwise acquire all or substantially all the assets of the

Corporation or any subsidiary.  The Board of Directors shall evaluate whether

the proposal is in the best interests of the Corporation and its subsidiaries by

considering the best interests of the shareholders and other factors the

directors determine to be relevant, including the social, legal and economic

effects on employees, customers, depositors, and communities served by the

Corporation and any subsidiary.  The Board of Directors shall evaluate the

consideration being offered to the shareholders in relation to the then current

market value of the Corporation or any subsidiary, the then current market value

of the stock of the Corporation or any subsidiary in a freely negotiated

transaction, and the Board of Directors' estimate of the future value of stock

of the Corporation or any subsidiary as an independent entity.

 

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                                  ARTICLE XV

 

                                Indemnification

 

     Subject to applicable provisions of federal law, the Corporation shall

indemnify to the fullest extent permissible under the Maryland General

Corporation Law any individual who is or was a director, officer, employee, or

agent of the Corporation, and any individual who serves or served at the

Corporation's request as a director, officer, partner, trustee, employee, or

agent of another corporation, partnership, joint venture, trust or other

enterprise, in any proceeding in which the individual is made a party as a

result of his service in such capacity.  An individual will not be indemnified

if (i) it is established that the act or omission at issue was material to the

matter giving rise to the proceeding and (a) was committed in bad faith, or (b)

was the result of active and deliberate dishonesty; (ii) the individual actually

received an improper personal benefit in money, property, or services; or (iii)

in the case of a criminal proceeding, the individual had reasonable cause to

believe that the act or omission was unlawful.  In the event any litigation is

brought against a director of this Corporation, authorization is hereby made to

advance all expenses needed by the director to defend the lawsuit.  There shall

be no obligation to repay the expenses forwarded, unless it shall be determined

ultimately by the Corporation, in accordance with the provisions of this Article

XV and the Maryland General Corporation Law, that the director shall not be

entitled to indemnification.

 

     The rights of indemnification provided for in this Article XV shall not be

exclusive of any other rights to which those indemnified may be entitled under

any Bylaw, agreement, vote of shareholders or disinterested directors, or

otherwise.  Rights of indemnification under this Article XV shall continue as to

a person who has ceased to serve in one of the capacities listed in the

immediately preceding paragraph and shall inure to the benefit of the heirs,

executors and administrators of such person.

 

                                  ARTICLE XVI

 

               Limitations on Liability of Officers and Directors

 

     An officer or director of the Corporation shall not be personally liable to

the Corporation or its shareholders for monetary damages for breach of their

fiduciary duty as an officer or director, unless:  (i) it is proved that the

individual officer or director actually received an improper benefit or profit

in money, property or services from the Corporation, or (ii) a judgment or other

final adjudication adverse to the individual officer or director is entered in a

proceeding based on a finding in the proceeding that the individual's action, or

failure to act, was the result of active and deliberate dishonesty and was

material to the cause of action adjudicated in the proceeding.  If the General

Laws of the State of Maryland are amended to further eliminate or limit the

personal liability of officers and directors, then the liability of officers and

directors of the Corporation shall be eliminated or limited to the fullest

extent permitted by Maryland law, as so amended.

 

     Any repeal or modification of the foregoing paragraph by the shareholders

of the Corporation shall not adversely affect any right or protection of an

officer or director of the Corporation existing at the time of such repeal or

modification.

 

                                  ARTICLE XVII

 

                          Special Quorum Requirements

 

     Any meeting of shareholders, whether annual or special, called to consider

a vote in favor of a reverse stock split or merger or consolidation of the

Corporation with, or a sale, exchange or lease of substantially all of the

assets of the Corporation as defined under Article XII of these Articles to, any

person or entity that is not recommended by the Board of Directors of the

Corporation by the required vote applicable to the proposed transaction under

Article XII or Article XIII of these Articles, shall require attendance in

person or by proxy of the holders of eighty percent (80%) of the outstanding

shares of voting stock of the Corporation in order for a quorum for the conduct

of business to exist.  Such a meeting may not be adjourned with notice if a

quorum is not present.

 

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                                 ARTICLE XVIII

 

                              Amendment of Bylaws

 

     In furtherance and not in limitation of the powers conferred by statute,

the Board of Directors of the Corporation is expressly authorized to make,

repeal, alter, amend and rescind the Bylaws of the Corporation.  Notwithstanding

any other provision of these Articles or the Corporation's Bylaws (and

notwithstanding the fact that some lesser percentage may be specified by law),

the Bylaws shall not be made, repealed, altered, amended or rescinded by the

shareholders of the Corporation except by the vote of the holders of not less

than eighty percent (80%) of the outstanding shares of capital stock of the

Corporation entitled to vote generally in the election of directors (considered

for this purpose as one class) cast at a meeting of the shareholders called for

that purpose (provided that notice of such proposed adoption, repeal,

alteration, amendment or rescission is included in the notice of such meeting)

or by a majority vote of the Board of Directors.

 

                                  ARTICLE XIX

 

                     Amendment of Articles of Incorporation

 

     The Corporation reserves the right to repeal, alter, amend or rescind any

provision contained in these Articles in the manner now or hereafter prescribed

by law, and all rights conferred on shareholders herein are granted subject to

this reservation.  Notwithstanding the foregoing, the provisions set forth in

Articles VI, IX, XII, XIII, XIV and this Article XIX of these Articles may not

be repealed, altered, amended or rescinded in any respect unless the same is

approved by the affirmative vote of the holders of not less than eighty percent

(80%) of the outstanding shares of capital stock of the Corporation entitled to

vote generally in the election of directors (considered for this purpose as a

single class) cast at a meeting of the shareholders called for that purpose

(provided that notice of such proposed adoption, repeal, alteration, amendment

or rescission is included in the notice of such meeting).

 

     I, THE UNDERSIGNED, being the incorporator hereinbefore named, for the

purpose of forming a corporation pursuant to the General Laws of the State of

Maryland, do make these Articles, hereby declaring and certifying that this is

my act and deed, and accordingly have hereunto set my hand this 22 day of

January, 1992.

 

 

 

                              /s/ Willard H. Derrick

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

                              Willard H. Derrick

 

                                       10

 

 

SANDY SPRING BANCORP, INC.

ARTICLES OF AMENDMENT

Sandy Spring Bancorp, Inc., a Maryland corporation (the “Corporation”), having its principal office in Olney, Montgomery County, Maryland, does hereby certify to the State Department of Assessments and Taxation that:

FIRST: The charter of the Corporation is hereby amended to cause the first sentence of Article V thereof to read as follows:

“The aggregate number of shares of all classes of capital stock which the corporation has authority to issue is 50,000,000 shares of capital stock, $1.00 par value per share, amounting in aggregate par value to $50,000,000.”

SECOND: The foregoing amendment was advised by the Board of Directors of the Corporation and approved by the shareholders of the Corporation .

THIRD: Immediately prior to adoption of the foregoing amendments the Bank was authorized to issue fifteen million shares of stock, pare value $1.00 per share, all of which were initially designated as common stock. Following such amendment, the Corporation is authorized to issue fifty million shares of stock, par value $1.00 per share, all of which are initially designated as common stock. The Board of Directors of the Corporation may classify and reclassify any unissued shares of capital stock by setting or changing in any one or more respects the preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions and dividends, qualifications or terms or conditions of redemption of such shares of stock.

The aggregate par value of all shares of all classes of stock which the Corporation is authorized to issue is $50,000,000.

The undersigned officers of Sandy Spring Bancorp, Inc. hereby acknowledge under penalties of perjury that the foregoing Articles of Amendment constitute the corporate act of said corporation.

ATTEST: {Seal}

/s/ Ronald E. Kuykendall

/s/ Hunter R. Hollar

Ronald E. Kuykendall, Secretary

Hunter R. Hollar

President and Chief Executive Officer

 

[As Filed: 03-15-2012]