**Exhibit 3(b)**

 

**AMENDED AND RESTATEDARTICLES OF INCORPORATION**

**OF**

**FIRST COMMUNITYFINANCIAL GROUP, INC**.

 

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**ARTICLE I**

**Name**

 

The name ofthe corporation shall be FIRST COMMUNITY FINANCIAL GROUP, INC.

 

**ARTICLE II**

**Duration**

 

Thecorporation’s period of duration shall be perpetual.

 

**ARTICLE III**

**PURPOSES**

 

The purposesfor which the corporation is organized are:

 

**Section3.1.    **To engage in business as abank holding company.

 

**Section3.2.    **To carry on any lawfulbusiness whatsoever in connection with the foregoing for which corporations maybe incorporated under the Washington Business Corporation Act, including anyamendments thereto or successor statutes that may hereinafter be enacted.

 

**ARTICLE IV**

**CAPITAL**

 

The aggregatenumber of shares that the Corporation shall have authority to issue is20,200,000 shares, 20,000,000 of which shall be common shares with no par valueper share, and 200,000 shares of preferred stock with no par value pershare.  The preferred stock will havesuch rights and preferences as may be determined by resolution of the Board ofDirectors.

 

**ARTICLE V**

**NO PRE-EMPTIVE RIGHTS**

 

No shareholdershall have the pre-emptive right to acquire unissued shares of the corporation,or securities convertible into shares of any class whatsoever, whether now orhereafter authorized, and whether issued for cash, property, services orotherwise.

 

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**ARTICLE VI**

**NO CUMULATIVE VOTING**

 

Eachshareholder entitled to vote at any election for directors shall have the rightto vote, in person or by proxy, the number of shares owned by  him/her for as many persons as there aredirectors to be elected and for whose election he/she has a right to vote, andno shareholder shall be entitled to cumulate his/her votes.

 

**ARTICLE VII**

**POWER TO AMEND BYLAWS**

 

The Board of Directorsshall have full power to adopt, alter, amend or repeal the Bylaws or adopt newBylaws.  Nothing herein, however, shalldeny the concurrent power of the shareholders to adopt, alter, amend or repealthe Bylaws.

 

**ARTICLE VIII**

**RIGHT TO AMEND**

 

The corporationreserves the right to amend, alter, change or repeal any provision of itsArticles of Incorporation to the extent permitted by the laws of the State ofWashington. All rights of shareholders are granted subject to this reservation.

 

**ARTICLE IX**

**REGISTERED OFFICE ANDAGENT**

 

The address ofthe initial registered office of the corporation is 721 College Street S.E.,P.O. Box 3800, Lacey, Washington 98509-3800. The name of its initial registered agent at that address is Ken F.Parsons.

 

**ARTICLE X**

**CONTRACTS**

 

Thecorporation may enter into a contract and otherwise transact business asvendor, purchaser or otherwise, with its directors, officers and shareholders,and with corporations, associations, firms and entities in which they are ormay become interested as directors, officers, shareholders, members orotherwise, as freely as though such adverse interest did not exist, even thoughthe vote, action or presence of such director, officer or shareholder may benecessary to obligate the corporation upon such contract or transaction; and inthe absence of fraud, no such contract or transaction shall be avoided and nosuch director, officer or shareholder shall be held liable to account to thecorporation, by reason of such adverse interest or any fiduciary relationshipto the corporation arising out of such office or stock ownership, for anyprofit or benefit realized by him/her through any such contract or transaction;provided that the nature of the interest of such director, officer orshareholder though not necessarily the details or extent thereof, be disclosedor known to the Board of Directors or shareholders of the corporation, at themeeting thereof at which such contract or transaction is authorized orconfirmed. A general 

 

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notice that a director, officeror shareholder of the corporation is interested in any corporation,association, firm or entity shall be sufficient disclosure as to such director,officer or shareholder with respect to all contracts and transactions with thatcorporation, association, firm or entity.

 

**ARTICLE XI**

**CAPITAL SURPLUS**

 

Thecorporation may use its unreserved and unrestricted capital surplus to purchaseits own shares and may, from time to time, distribute to shareholders, cash orproperty out of its capital surplus.

 

**ARTICLE XII**

**BOARD NOMINATIONS**

 

Nominationsfor election to the Board of Directors may be made by the Board of Directors orby any shareholder of any outstanding class of stock of the corporationentitled to vote for the election of directors. Nominations, other than thosemade by the Board of Directors, shall be made in writing and shall be deliveredor mailed, U.S. mail, postage prepaid, to the Chairman of the corporation notless than fourteen (14) days nor more than fifty (50) days prior to any meetingof shareholders called for the election of directors; provided, however, thatif less than twenty-one (21) days’ notice of the meeting is given toshareholders, such nomination shall be delivered or mailed, U.S. mail, postageprepaid, to the Chairman of the corporation not later than the close ofbusiness on the seventh (7th) day following the day on which the notice ofmeeting was mailed. Such notification shall contain the following informationto the extent known to the notifying shareholder:

 

(a)           The name and address of each proposednominee;

 

(b)           The principal occupation of eachproposed nominee;

 

(c)           The total number of shares of stockof the corporation that will be voted for each proposed nominee;

 

(d)           The name and address of the notifyingshareholder; and

 

(e)           The number of shares of common stockof the corporation owned by the notifying shareholder.

 

Nominationsnot made in accordance herewith may, in his/her discretion, be disregarded bythe Chairman of the meeting, and upon his/her instructions, the vote teller maydisregard all votes cast for such nominee.

 

**ARTICLE XIII**

**INDEMNIFICATION ANDDIRECTOR LIABILITY**

 

**Section13.1.    Definitions.**  As used in this Article:

 

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(a)           The term “Egregious Conduct” by aperson shall mean acts or omissions that involve intentional misconduct or aknowing violation of law, conduct violating Section 23B.08.310 of the RevisedCode of Washington, as amended, or participation in any transaction from whichthe person will personally receive a benefit in money, property, or services towhich the person is not legally entitled.

 

(b)           The term “Finally Adjudged” shallmean stated in a judgment based upon clear and convincing evidence by a courthaving jurisdiction, from which there is no further right to appeal.

 

(c)           The term “Director” shall mean anyperson who is a director of the corporation and any person who, while adirector of the corporation, is serving at the request of the corporation as adirector, officer, partner, trustee, employee, or agent of another foreign ordomestic corporation, limited liability company, partnership, joint venture,trust, or other enterprise, or is a fiduciary or party in interest in relation toany employee benefit plan covering any employee of the corporation or of anyemployer in which it has an ownership interest; and “conduct as a Director”shall include conduct while a Director is acting in any of such capacities.

 

(d)           The term “Officer-Director” shallmean any person who is simultaneously both an officer and director of thecorporation and any person who, while simultaneously both an officer anddirector of the corporation, is serving at the request of the corporation as adirector, officer, manager, partner, trustee, employee, or agent of anotherforeign or domestic corporation, limited liability company, partnership, jointventure, trust, or other enterprise, or is a fiduciary or party in interest inrelation to any employee benefit plan covering any employee of the corporationor of any employer in which it has an ownership interest; and “conduct as anOfficer-Director” shall include conduct while such a person is acting as anofficer of the corporation or in any of such other capacities.

 

(e)           The term “Subsidiary Corporation”shall mean any corporation or limited liability company at least eighty percentof the voting interests of which is held beneficially by this corporation.

 

(f)            The term “Subsidiary OutsideDirector” shall mean any person who, while not principally employed by thiscorporation or any Subsidiary Corporation, is a director or manager of aSubsidiary Corporation and any such person who, while a director or manager ofa Subsidiary Corporation, is serving at the request of such corporation as adirector, officer, manager, partner, trustee, employee, or agent of anotherforeign or domestic corporation, limited liability company, partnership, jointventure, trust, or other enterprise, or is a fiduciary or party in interest inrelation to any employee benefit plan covering any employee of such corporationor of any employer in which it has an ownership interest; and “conduct as aSubsidiary Outside Director” shall include conduct while such a person isacting in any of such capacities.

 

**Section13.2.    Liability of Directors.**  No Director, Officer-Director, formerDirector or former Officer-Director shall be personally liable to thecorporation or its shareholders for monetary damages for conduct as a Directoror Officer-Director occurring after the effective date of this Article unlessthe conduct is Finally Adjudged to have been Egregious Conduct.

 

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**Section13.3.    Liability of Subsidiary Outside Directors.**  No Subsidiary Outside Director or formerSubsidiary Outside Director shall be personally liable in any action broughtdirectly by this corporation as a shareholder of the Subsidiary Corporation orderivatively on behalf of the Subsidiary Corporation (or by any shareholder ofthis corporation double-derivatively on behalf of this corporation and theSubsidiary Corporation) for monetary damages for conduct as a SubsidiaryOutside Director occurring after the effective date of this Article unless theconduct is Finally Adjudged to have been Egregious Conduct.

 

**Section13.4.    Mandatory Indemnification of Directors.**  Subject to Sections 13.7 and 13.8 of thisArticle, the corporation shall indemnify any person who is, or is threatened tobe made, a party to any action, suit, or proceeding, whether civil, criminal,administrative, or investigative, and whether formal or informal, and whetherby or in the right of the corporation or its shareholders or by any otherparty, by reason of the fact that the person is or was a Director, Officer-Director,or Subsidiary Outside Director against judgments, penalties or penalty taxes,fines, settlements (even if paid or payable to the corporation or itsshareholders or to a Subsidiary Corporation) and reasonable expenses, includingattorneys’ fees, actually incurred in connection with such action, suit orproceeding unless the liability and expenses were on account of conduct FinallyAdjudged to be Egregious Conduct.

 

**Section13.5.    Advancing Expenses.**  Except as prohibited by Sections 13.7 and13.8 of this Article, the reasonable expenses, including attorneys’ fees, of aDirector, Officer-Director, Subsidiary Outside Director, or person formerlyserving in any such capacities, incurred in connection with an action, suit orproceeding in which the individual is entitled to indemnification under Section13.4 shall be paid or reimbursed by the corporation, upon request of suchperson, in advance of the final disposition of such action, suit or proceedingupon receipt by the corporation of a written, unsecured promise by the personto repay such amount if it shall be Finally Adjudged that the person is noteligible for indemnification.  Allexpenses incurred by such person in connection with such action, suit orproceeding shall be considered reasonable unless Finally Adjudged to beunreasonable.

 

**Section13.6.    Procedure.**  Except as required by Sections 13.7 and 13.8of this Article, no action by the Board of Directors, the shareholders,independent counsel, or any other person or persons shall be necessary orappropriate to the determination of the corporation’s indemnificationobligation under this Article in any specific case, to the determination of thereasonableness of any expenses incurred by a person entitled to indemnificationunder this Article, nor to the authorization of indemnification in any specificcase.

 

**Section13.7.    Exception for Internal Claims.**  Notwithstanding anything else in theseArticles, the corporation shall not be obligated to indemnify any person forany expenses, including attorneys’ fees, incurred to assert any claim againstthe corporation (except a claim to enforce rights to indemnification) or anyperson related to or associated with it, including any person who would beentitled hereby to indemnification in connection with the claim.

 

**Section13.8.    Exception for Regulatory Claims.**

 

(a)     RegulatoryProceedings Generally. Notwithstanding anything else in these Articles, indemnification of anyDirector, Officer-Director or Subsidiary Outside 

 

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Director, orany person formerly serving in any such capacities, and advancement of expensesin connection with either an administrative proceeding or a civil actioninstituted by a federal banking agency (“Regulatory Proceedings”) shall begoverned by this Section.

 

(b)     BankingRegulations Defined.  The term“Banking Regulations” shall mean any state or federal laws or regulationsapplicable to the corporation, or any formal policies adopted by a regulatoryagency having jurisdiction over the corporation.

 

(c)     Indemnificationin Regulatory Proceedings.  Thecorporation shall provide indemnification and advancement of expenses inconnection with Regulatory Proceedings to the extent permitted, and in themanner prescribed by Banking Regulations. Insurance and other means to ensure payment of costs and expenses inRegulatory Proceedings may be obtained or provided to the extent permitted andin the manner prescribed by Banking Regulations.

 

(d)     FederalDeposit Insurance Corporation. Notwithstanding anything else in theseArticles, the Articles are subject to the requirements and limitations setforth in state and federal laws, rules, regulations, and orders regardingindemnification and prepayment of legal expenses and liabilities, includingSection 18(k) of the Federal Deposit Insurance Act, as amended, and Part 359 ofthe Federal Deposit Insurance Corporation’s Rules and Regulations or anysuccessor regulations.  To the extent ofany conflict between state and federal law regarding the interpretation andscope of the Articles, federal law shall supercede and control.

 

**Section13.9.    Enforcement of Rights.**  The corporation shall indemnify any persongranted indemnification rights under this Article against any reasonable expensesincurred by the person to enforce such rights.

 

**Section13.10.    Set-off of Claims.**  Any person granted indemnification rightsherein may directly assert such rights in set-off of any claim raised againstthe person by or in the right of the corporation and shall be entitled to havethe same tribunal which adjudicates the corporation’s claim adjudicate theperson’s entitlement to indemnification by the corporation.

 

**Section13.11.    Continuation of Rights.**  The indemnification rights provided in thisArticle shall continue as to a person who has ceased to be a Director,Officer-Director, or Subsidiary Outside Director and shall inure to the benefitof the heirs, executors, and administrators of such person.

 

**Section13.12.    Effect of Amendment or Repeal.**  Any amendment or repeal of this Articleshall not adversely affect any right or protection of a Director,Officer-Director, or Subsidiary Outside Director or person formerly serving inany of such capacities existing at the time of such amendment or repeal withrespect to acts or omissions occurring prior to such amendment or repeal.

 

**Section****13.13.    Severabilityof Provisions.**  Each ofthe substantive provisions of this Article is separate and independent of theothers, so that if any provision hereof shall be held to

 

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be invalid or unenforceable forany reason, such invalidity or unenforceability shall not affect the validityor enforceability of the other provisions.

 

**Section****13.14    Application to Officers, Employees and Agents.**  By resolution, the Board of Directors may extend the provisionsof this Article 13 to any officers, employees or agents of the corporation.

 

**ARTICLE XIV**

**DIRECTORS**

 

The board ofdirectors shall be divided into three classes: Class 1, Class 2, and Class 3,which shall be nearly equal in number as possible. Each director shall servefor a term ending on the date of the third annual meeting of the shareholdersfollowing the annual meeting at which such director was elected; provided,however, that each initial director in Class 1 shall hold office until theannual meeting of shareholders in 1988, each initial director in Class 2 shallhold office until the annual meeting of shareholders in 1989; and each initialdirector in Class 3 shall hold office until the annual meeting of shareholdersin 1990.

 

**ARTICLE XV**

**INCORPORATOR**

 

The name andaddress of the incorporator is George W. Bowen, 3033 Carpenter Loop S.E.,Lacey, Washington 98503.

 

**ARTICLE XVI**

**EVALUATING OFFERS**

 

The Board ofDirectors of the corporation, when evaluating any offer of another party to (a)make a tender or exchange offer for any equity security of the corporation, (b)merge or consolidate the corporation with another corporation, or (c) purchaseor otherwise acquire all or substantially all of the properties and assets ofthe corporation, shall, in connection with the exercise of its judgment indetermining what is in the best interests of the corporation and itsstockholders, give due consideration to all relevant factors, including withoutlimitation the social and economic effects on the community, employees,customers, and other constituents of the corporation and its subsidiary.

 

**ARTICLE XVII**

**FAIR PRICE PROVISION**

 

**Section17.1.    **In addition to therequirements of any applicable statute, and notwithstanding any otherprovisions of any other articles of these Articles of Incorporation, theaffirmative vote of not less than 90% of the total shares which are entitled tobe voted in an election of directors shall be required for the approval of anyBusiness Combination (as defined below).

 

**Section****17.2.    **Theapproval requirements of Section 17.1 shall not apply if either:

 

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(a)           The Business Combination is approvedby at least 66 2/3% of the Directors of the Corporation; or

 

(b)           Both of the following conditions aresatisfied:

 

(i)            The cash or fair market value of theproperty, securities or other consideration to be received per share in theBusiness Combination by holders of the common stock of the corporation is notless than the highest price per share (including brokerage commissions,soliciting dealers’ fees and dealer-management compensation) paid by suchofferor in acquiring any of its holdings of the corporation’s common stock; and

 

(ii)           A proxy statement responsive to therequirements of the Securities Exchange Act of 1934, whether or not thecorporation is then subject to such requirements, shall be mailed to thestockholders of the corporation for the purpose of soliciting stockholderapproval of such Business Combination.

 

**Section17.3.    **For the purposes of thisArticle 17:

 

(a)        The term “BusinessCombination” shall mean (i) any merger or consolidation of the corporation,(ii) any sale, lease, exchange, transfer or other disposition, includingwithout limitation a mortgage or any other security device, of all or anySubstantial Part (as defined below) of the assets of the corporation (includingwithout limitation any voting securities of a subsidiary) or of a subsidiary,(iii) any merger or consolidation with or into a corporation or its subsidiary,(iv) the issuance of any securities of the corporation or a subsidiary of thecorporation to any person or entity, or (v) any agreement, contract or other arrangementproviding for any of the transactions described in this definition of BusinessCombination;

 

(b)        The term “SubstantialPart” shall mean more than 10% of the total assets of the corporation inquestion, as of the end of its most recent fiscal year prior to the timedetermination is being made;

 

(c)        Without limitation, anyshares of common stock of the corporation which any person has the right toacquire at any time pursuant to any agreement, or upon exercise of conversionright, warrants or options, or otherwise, shall be deemed outstanding andbeneficially owned by such person for purposes of this Article 17; and

 

(d)        For the purposes ofSection 17.2(b)(i) of this Article, the phrase “other consideration to bereceived” shall include, without limitation, common stock of the corporationretained by its existing stockholders in the event of a Business Combination inwhich the corporation is the surviving corporation

 

**Section17.4.    **For the purposes of thisArticle 17, a majority of the Directors shall have the power and duty todetermine on the basis of information known to them (a) whether a proposedtransaction is subject to the provisions of this Article 17, (b) the amount ofshares of the corporation Beneficially Owned by any person, (c) whether aperson is an Affiliate or 

 

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Associate of another, and (d)such other matters as to which a determination may be required by theprovisions of this Article 17.

 

**Section17.5.    **The provisions set forthin this Article 17 may not be repealed or amended in any respect or in anymanner including any merger or consolidation of the corporation with any othercorporation unless the surviving corporation’s Articles of Incorporation contain an article to the same effect asthis Article 17, except by the affirmative vote of the holders of not less than90% of the outstanding shares of common stock of the corporation.

 

**ARTICLE XVIII**

**SPECIAL MEETING OFSHAREHOLDERS**

 

Specialmeetings of the shareholders may be called at any time by the President, amajority of the Board of Directors, or by shareholders owning in the aggregatenot less than fifty percent (50%) of the shares entitled to vote at the specialmeeting.

 

 
| DATED this  30th of October 2002. |                                  |
|-----------------------------------|---------------------------------------|
|                              |                                  |
|                              |                                  |
|                              | /s/ Ken F. Parsons                    |   |
|                              | Ken F.  Parsons, President and C.E.O. |

 

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