EXHIBIT 3.1

AMENDED AND RESTATED

ARTICLES OF  INCORPORATION

 OF

COMMUNITY BANKSHARES,  INC.

I.

                         The name of the corporation is:

COMMUNITY BANKSHARES,  INC.

II.

                         The Corporation is organized pursuant to the provisions of Georgia Business  Corporation Code.

III.

                         The Corporation shall have perpetual duration.

IV.

                         The Corporation is organized for the purpose of doing any and all things which  a corporation may now or hereafter be authorized to do under the Georgia  Business Corporation Code or under any act amendatory thereof, supplemental  thereto, or substituted therefore, including, but not by way of limitation,  the following specific purposes:

                         (a)       To act as a holding company and  to acquire, own, hold, sell, exchange, assign, transfer, create security  interest in, pledge or otherwise dispose of shares, or voting trust  certificates or depository receipts for shares, or capital stock of, or any  bonds, notes, debentures or other evidences of indebtedness, options, warrants  or other securities issued by, other businesses of any lawful charter,  including, but not limited to, banks, insurance agencies and companies,  mortgage loan and servicing companies, trust companies, data processing  companies, courier or messenger companies and any other businesses providing  goods or services related to banking; and

                         (b)       To operate insurance agencies,  to make and acquire mortgage loans and render mortgage loan services, to  provide data processing and management services, to provide factoring  services, to provide courier or messenger services and to provide other goods  or services related to banking.

 

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                         To do each and every thing necessary, suitable or proper for the  accomplishment of any of the purposes or the attainment of any one or more of  the objects herein enumerated, or which shall at any time appear conducive to  or expedient for the protection or benefit of the Corporation.

                         IN FURTHERANCE OF AND NOT IN LIMITATION of the general powers conferred by the  laws of the State of Georgia and the objects and purposes herein set forth, it  is expressly provided that to such extent as a corporation organized under the  Georgia Business Corporation Code may now or hereafter lawfully do, the  Corporation shall have the power to do, either as principal or agent and  either alone or in connection with other corporations, firms or individuals,  all and everything necessary, suitable, convenient or proper for, or in  connection with, or incident to, the accomplishment of any of the purposes or  the attainment of any one or more of the objects herein enumerated, or  designed directly or indirectly to promote the interests of the Corporation or  to enhance the value of its properties; and in general to do any and all  things and exercise any and all powers, rights and privileges which a  corporation may now or hereafter be authorized to do or to exercise under the  Georgia Business Corporation Code or under any act amendatory thereof,  supplemental thereto or substituted therefor.

                         The foregoing provisions of this Article IV shall be construed both as  purposes and powers and each as an independent purpose and power.  The  foregoing enumeration of specific purposes and powers herein specified shall,  except when otherwise provided in this Article IV, be in no wise limited or  restricted by reference to, or inference from, the terms of any provision of  this or any other Article of these Articles of Incorporation.

V.

                         The total number of shares of capital stock which the Corporation shall have  authority to issue is 5,100,000 shares, consisting of 5,000,000 shares of  Common Stock of $1.00 par value per share (the “Common Stock”) and 100,000  shares of Preferred Stock of $50.00 par value per share (the “Preferred  Stock”).

                         The Corporation may purchase its own shares of capital stock out of unreserved  and unrestricted earned surplus and capital surplus available therefor and as  otherwise provided by law.

                         The voting powers, designations, preferences and relative rights of the  classes of stock of the Corporation which are fixed by these Articles of  Incorporation and the authority expressly vested in the Board of Directors to  fix, by resolution or resolutions providing for the issue of Preferred Stock,  the voting powers (if any), designations, preferences and relative rights of  the shares of Preferred Stock which are not fixed by these Articles of  Incorporation, are as follows:

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                         (1)       Subject to the provisions of  any applicable law, or of the By-Laws of the Corporation as from time to time  amended, with respect to the fixing of a record date for the determination of  shareholders entitled to vote and except as otherwise provided by any  applicable law or by the resolution or resolutions of the Board of Directors  providing for the issue of any series of Preferred Stock, the holders of  outstanding shares of Common Stock shall have and possess exclusive voting  power and rights for the election of directors and for all other purposes,  with each holder of record of shares of Common Stock being entitled to one  vote for each share of Common Stock being entitled to one vote for each share  of Common Stock standing in his name on the books of the Corporation in the  election of directors and on all other matters presented to the shareholders.

                         (2)       Except as otherwise provided by  applicable law, or by the resolution or resolutions of the Board of Directors  providing for the issue of any series of Preferred Stock, the holders of  shares of Preferred Stock, as such holders, (i) shall not have any right to  vote, and are hereby specifically excluded from the right to vote, in the  election of directors or for any other purpose, and (ii) shall not be entitled  to notice of any meeting of shareholders.

                         (3)       Before any sum or sums shall be  set aside or applied to the purchase of any outstanding shares of Common  Stock, and before any dividend shall be declared or paid or any distribution  ordered or made upon the Common Stock (other than a dividend payable in shares  of Common Stock), the Corporation shall have complied with the dividend and  sinking fund requirements (if any) set forth in any resolution or resolutions  of the Board of Directors with respect to the issue of any series of Preferred  Stock of which any shares shall at the time be outstanding.

                         (4)       Subject the provisions of  Paragraph 3 of this Article V, and to such other limitations as may be  specified in any resolution or resolutions of the Board of Directors providing  for the issue of any series of Preferred Stock, the holders of outstanding  shares of Common Stock shall be entitled, to the exclusion of the holders of  shares of Preferred Stock of any and all series, to receive such dividends as  may be declared by the Board of Directors from time to time.

                         (5)       In the event of any  liquidation, dissolution or winding up of the Corporation, whether voluntary  or involuntary, after payment shall have been made to the holders of shares of  Preferred Stock of the full amount to which any series of the Preferred Stock  of the full amount to which any series of the Preferred Stock is entitled as  set forth in the resolution or resolutions of the Board of Directors providing  for the issue thereof, the holders of outstanding shares of Common Stock shall  be entitled, to the exclusion of the holders of shares of Preferred Stock of  any and all series, to share in all remaining assets of the Corporation  available for distribution to its shareholders ratably according to the number  of shares of Common Stock held by them.  Neither the merger nor  consolidation of the Corporation with or into any other corporation or  corporations, nor the

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merger or consolidation of any other corporation or  corporations into or with the Corporation, nor the sale, transfer, mortgage,  pledge or lease by the Corporation of all or any part of its assets shall be  deemed to be a liquidation, dissolution or winding up of the Corporation.

                         (6)       The Preferred Stock may be  issued from time to time in one or more series of any number of shares, except  that the aggregate number of shares issued and not cancelled of any and all  such series shall not exceed the total number of shares of Preferred Stock  hereinabove authorized.  Each series of Preferred Stock shall be  distinctively designated by number, letter or descriptive words.

                         (7)       Authority is hereby expressly  granted to and vested in the Board of Directors to issue the Preferred Stock  at any time, or from time to time, as Preferred Stock of any one or more  series, and, in connection with the establishment of each such series, to fix  by resolution or resolutions providing for the issue of the shares thereof the  voting powers, if any, and the designation, preferences and relative rights of  each such series of Preferred Stock to the full extent now or hereafter  permitted by these Articles of Incorporation and the laws of the State of  Georgia, including, without limiting the generality of the foregoing, all of  the following matters which any vary between each series:

                         (a)       The distinctive designation of  such series and the number of shares which constitute such series, which  number may be increased or decreased either before or subsequent to the  issuance of any shares of such series (but not below the number of shares of  such series then outstanding), from time to time by action of the Board of  Directors;

                         (b)       The dividend rate of such  series, the dates of payment thereof, and any limitations, restrictions or  conditions on the payment of dividends, including whether dividends shall be  cumulative and, if so, from which date or dates, and the relative rights of  priority, if any, of payment of dividends on the shares of each series;

                         (c)       The price or prices at which,  and the terms, times and conditions on which, the shares of such series may be  redeemed at the option of the Corporation or at the option of the holder of  such shares;

                         (d)       The amount or amounts payable  upon the shares of such series in the event of voluntary or involuntary  liquidation, dissolution or winding up of the Corporation, and the relative  rights of priority, if any, of payment to the holders of shares of each  series;

                         (e)       Whether or not the shares of  such series shall be entitled to the benefit of a purchase, retirement or  sinking fund to be applied to the redemption or purchase of such series, and  if so entitled, the amount of such fund and the manner of its application,  including the price or prices at which the shares of such series may be  redeemed or purchased through the application of such fund;

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                         (f)        Whether or not the shares  of such series shall be made convertible into, or exchangeable for, shares of  any other class or classes of stock of the Corporation, or the shares of any  other series of Preferred Stock, and, if made 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;

                         (g)       Whether or not the shares of  such series shall have any voting right, and, if voting rights are so granted,  the extent of such voting rights and the terms and conditions under which such  voting rights may be exercised;

                         (h)       Whether or not the issue of any  additional shares of such series or of any future series in addition to such  series shall be subject to restrictions in addition to the restrictions, if  any, on the issue of additional shares imposed in the resolution or  resolutions fixing the terms of any outstanding series of Preferred Stock  theretofore issued pursuant to this Paragraph 7, and, if subject to additional  restrictions, the extent of such additional restrictions; and

                         (i)        Whether or not the shares of  such series shall be entitled to the benefit of limitations restrictions the  purchase of, the payment of dividends on, or the making of other distributions  in respect of stock of any class of the Corporation, and the terms of any such  restrictions; provided, however, that such restrictions shall not include any  prohibition on the payment of dividends or with respect to distributions in  the event of voluntary or involuntary liquidation established for any  outstanding series of Preferred Stock theretofore issued.

                         The Board of Directors may from time to time distribute to stockholders out of  capital surplus of the Corporation a portion of its assets, in cash or in  property.

VI.

                         None of the holders of any capital stock of the Corporation of any kind, class  or series now or hereafter authorized shall have preemptive rights with  respect to any shares of capital stock of the Corporation of any kind, class  or series now or hereafter authorized.

VII.

                         In discharging the duties of their respective positions and in determining  what is believed to be in the best interests of the Corporation, the Board of  Directors of the Corporation, committees of the Board of Directors, and  individual directors, in addition to considering the effects of any action on  the Corporation or its Shareholders, may consider interests of the employees,  customers, suppliers, and creditors of the Corporation and its subsidiaries,  the communities in which offices or other establishments of the Corporation  and its subsidiaries are located, and all other factors such directors  consider pertinent; provided,

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however, that such consideration shall be deemed  solely to grant discretionary authority to the directors and shall not be  deemed to provide to any constituency any right to be considered.

VIII.

                         No director of the Corporation shall be personally liable to the Corporation  or its shareholders for monetary damages for breach of his duty of care or  other duty as a director, provided, that this provision shall eliminate or  limit the liability of a director only to the extent permitted from time to  time by the Georgia Business Corporation Code or any successor laws or laws.

IX.

                         I. (A) In addition to any affirmative vote required by law, and subject to the  provisions of any series of Preferred Stock which may at the time be  outstanding, the affirmative vote of the holders of not less than 75% of the  outstanding shares of Common Stock of the Corporation and the affirmative vote  of the holders of not less than 75% of the outstanding shares of Common Stock  of the Corporation other than those beneficially owned (as defined below) by  an Interested Shareholder (as defined below) (the "two-tier voting  requirement"), shall be required for the approval or authorization of any  Business Combination (as defined below) of the Corporation with such  Interested Shareholder; provided that the two-tier voting requirement shall  not be applicable if the Business Combination was approved by three-fourths of  all Directors.

                         (B) The term "Business Combination" as used in this Article IX shall  mean:

                         (i) any merger or consolidation of the Corporation or any Subsidiary (as  hereafter defined) with (a) any Interested Shareholder (as hereinafter  defined) or (b) any other corporation (whether or not itself an Interested  Shareholder) which is, or after such merger or consolidation would be, an  Affiliate (as hereinafter defined) of an Interested Shareholder; or (ii) any  sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one  transaction or a series of transactions) to or with any Interested Shareholder  or any Affiliate of any Interested Shareholder of any assets of the  Corporation or any Subsidiary having an aggregate Fair Market Value (as  hereinafter defined) of $1,000,000 or more; or (iii) the issuance or transfer  by the Corporation or any Subsidiary (in one transaction or a series of  transactions) of any securities of the Corporation or any Subsidiary to any  Interested Shareholder or any Affiliate of any Interested Shareholder in  exchange for cash, securities or other property (or a combination thereof)  having an aggregate Fair Market Value of $1,000,000 or more; or (iv) the  adoption of any plan or proposal for the liquidation or dissolution of the  Corporation proposed by or on behalf of an Interested Shareholder or any  Affiliate of any Interested Shareholder; or (v) any reclassification of  securities (including any reverse stock split), or recapitalization of the  Corporation, or any merger or consolidation of the Corporation with any of its  Subsidiaries or any other transaction (whether or not with or

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into or  otherwise involving an Interested Shareholder) which has the effect, directly  or indirectly, of increasing the proportionate share of the outstanding shares  of any class of equity or convertible securities of the Corporation or any  Subsidiary which is directly or indirectly owned by any Interested Shareholder  or any Affiliate of any Interested Shareholder.

                         II.  For purposes of this Article IX:

                         (A)  A "person" shall mean any individual, firm, corporation or  other entity. 

                         (B)  "Interested Shareholder" shall mean any person (other than  the Corporation, any Subsidiary or either the Corporation or any Subsidiary  acting as Trustee or in a similar fiduciary capacity) who or which: (i) is the  beneficial owner of more than 10% of the outstanding Common Stock; or (ii) is  an Affiliate of the Corporation and at any time within the two– year  period immediately prior to the date in question was the beneficial owner,  directly or indirectly, of 10% or more of the then outstanding Common Stock;  or (iii) acquired any shares of Common Stock which were at any time within the  two–year period immediately prior to the date in question beneficially  owned by any Interested Shareholder, if such acquisition shall have occurred  in the course of a transaction or series of transactions not involving a  public offering within the meaning of the Securities Act of 1993. 

                         (C)  A person shall be a "beneficial owner" of any Common  Stock:  (i) which such person or any of its Affiliates or Associates (as  hereinafter defined) beneficially owns, directly or indirectly; or (ii) which  such person or any of its Affiliates or Associates has, directly or  indirectly, (a) the right to acquire (whether such right is exercisable  immediately or only after the passage of time), pursuant to any agreement,  arrangement or understanding or upon the exercise of conversion rights,  exchange rights, warrants or options or otherwise, or (b) the right to vote  pursuant to any agreement, arrangement or understanding; or (iii) which are  beneficially owned, directly or indirectly, by any other person with which  such person or any of its Affiliates or Associates has any agreement,  arrangement or understanding for the purpose of acquiring, holding, voting or  disposing of any shares of Common Stock. 

                         (D)  For the purposes of determining whether a person is an Interested  Shareholder pursuant to paragraph B of this Section II, the number of shares  of Common Stock deemed to be outstanding shall include shares deemed owned  through application of paragraph C(ii)(a) of this Section II but shall not  include any other shares of Common Stock which may be issuable pursuant to any  agreement, arrangement or understanding, or upon exercise of conversion  rights, warrants or options, or otherwise.

                         (E)  (i) An "Affiliate" of a specified person is a person that  directly, through one or more intermediaries, controls, or is controlled by,  or is under common control with, the person specified.  (ii) The term  "Associate" used to indicate a relationship with any person means  (1) any firm, corporation or other entity (other than the Corporation or any  Subsidiary) of which such person is an officer or partner or is, directly or  indirectly, the beneficial owner

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of 10% or more of any class of equity  securities, (2) any trust or other estate in which such person has a  substantial beneficial interest or as to which such person serves as trustee  or in a similar fiduciary capacity, and (3) any relative or spouse or such  person, or any relative of such spouse who has the same home as such  person. 

                         (F)  "Subsidiary" means any corporation of which a majority of  any class of equity securities is owned, directly or indirectly, by the  Corporation unless owned solely as trustee or other similar fiduciary  capacity. 

                         (G)  "Fair Market value" means:  (i) in the case of stock,  the closing sales price of a share of such stock on the Composite Tape on the  New York Stock Exchange–Listed Stocks, or, if such stock is not quoted  on the Composite Tape, on the New York Stock Exchange, or, if such stock is  not listed on such Exchange, on the principal United States securities  exchange registered under the Securities Exchange Act of 1934, as amended, on  which such stock is listed, or, if such stock is not listed on any such  exchange, the closing sales price or the sales price or the average of the bid  and asked prices reported with respect to a share of such stock on the  National Association of Securities Dealers, Inc. Automated Quotation System or  any system then in use, or if no such quotations are available, the fair  market value on the date in question of a share of such stock as determined by  the Board in good faith; and (ii) in the case of property other than cash or  stock, the fair market value of such property on the date in question as  determined by the Board in good faith. 

                         (H)  The term "acquire" or "acquired" means the  acquisition of beneficial ownership. 

                         (I)  The Directors of the Corporation shall have the power and duty to  determine for the purposes of this Article IX, on the basis of information  known to them after reasonable inquiry, (i) whether a person is an Interested  Shareholder, (ii) the number of shares of Common Stock beneficially owned by  any person, (iii) whether a person is a Affiliate or Associates or another,  and (iv) whether the assets which are the subject of any Business Combination  have, or the consideration to be received for the issuance or transfer of  securities by the Corporation or any Subsidiary in any Business Combination  has, an aggregate Fair Market Value of $1,000,000 or more. 

                         (J)  Nothing contained in this Article IX shall be construed to relieve  any Interested Shareholder of any of its Affiliates or Associates from any  fiduciary obligation imposed by law.

X.

                         Except as otherwise provided by law, any amendment or repeal of any provision  of the Articles of Incorporation or the By–Laws of the Corporation  requires the

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affirmative vote of holders of 80% of the shares of capital stock  of the Corporation then issued and outstanding and entitled to vote on such  matters.

XI.

                         A director of the Corporation may be removed only for cause and upon the  affirmative vote of the holders of 80% of the issued and outstanding shares  entitled to vote on such matter.”

XII.

                         The Corporation shall not commence business until it shall have received not  less than $500 in payment for the issuance of shares in stock.

                         IN WITNESS WHEREOF, COMMUNITY BANKSHARES, INC., has caused these Amended and  Restated Articles of Incorporation to be executed and its corporate seal to be  affixed hereto by its duly authorized officers this 30 th day of June, 1997.

                                                                         COMMUNITY BANKSHARES, INC.

 

                                                                         By:    /s/ Harry  Stephens                                                                                                      Harry Stephens                                                                               Its:  CFO

(CORPORATE SEAL)

 

 

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