414E-2. Control share acquisitions
(a) Unless otherwise expressly provided in the articles of incorporation of an issuing public corporation, this section applies to a control share acquisition.
(b) All shares acquired by an acquiring person
in violation of subsection (e) shall be denied voting rights for one year after
acquisition. The shares shall be nontransferable on the books of the
corporation for one year after acquisition and the corporation, during the
one-year period, shall have the option to call the shares for redemption either
at the price at which the shares were acquired or at book value per share as of
the last day of the fiscal quarter ending prior to the date of the call for redemption.
The redemption shall occur on the date set in the call notice but not later
than sixty days after the call notice is given.
(c) A person proposing to make a control share
acquisition shall deliver to the issuing public corporation at its principal
executive office an information statement containing all of the following:
(1) The identity of the person;
(2) A reference that the statement is made under this
section;
(3) The number of shares of the issuing public
corporation beneficially owned by the person;
(4) A specification of which of the following ranges
of voting power in the election of directors would result from consummation of
the control share acquisition:
(A) At least ten per cent but less than
twenty per cent;
(B) At least twenty per cent but less than
thirty per cent;
(C) At least thirty per cent but less than
forty per cent;
(D) At least forty per cent but less than a
majority; or
(E) At least a majority; and
(5) The terms of the proposed control share
acquisition, including, but not limited to, the source of funds or other
consideration and the material terms of the financial arrangements for the
control share acquisition; any plans or proposals of the acquiring person to
liquidate the issuing public corporation, sell all or substantially all of its
assets, or merge it or exchange its shares with any other person, change the
location of its principal executive office or of a material portion of its
business activities, change materially its management or policies of
employment, alter materially its relationship with suppliers or customers or
the communities in which it operates, or make any other material change in its
business, corporate structure, management, or personnel, and such other
information which would affect the decision of a shareholder with respect to
voting on the proposed control share acquisition.
(d) Within five days after receipt of an
information statement pursuant to subsection (c), a special meeting of the
shareholders of the issuing public corporation shall be called pursuant to
section 414‑122, to vote on the proposed control share acquisition. The
meeting shall be held no later than fifty-five days after receipt of the
information statement, unless the acquiring person agrees to a later date and
no sooner than thirty days after receipt of the information statement, unless
the acquiring person so requests in writing when delivering the information
statement. The notice of the meeting at a minimum shall be accompanied by a
copy of the information statement, and a statement disclosing that the issuing
public company recommends:
(1) Acceptance of;
(2) Expresses no opinion and is remaining neutral
toward; or
(3) Is unable to take a position with respect to;
the proposed control share acquisition. The notice
of meeting shall be given within twenty-five days after receipt of the
information statement.
Notwithstanding any contrary provision of this
chapter, a proxy relating to a meeting of shareholders required under this
subsection must be solicited separately from the offer to purchase or
solicitation of an offer to sell shares of the issuing public corporation and
must not be solicited sooner than thirty days before the meeting unless
otherwise agreed in writing by the acquiring person and the issuing public
corporation.
(e) The acquiring person may consummate the
proposed control share acquisition if and only if both the following occur:
(1) The proposed control share acquisition is
approved by the affirmative vote of the holders of a majority of the voting
power of all shares entitled to vote which are not beneficially owned by the
acquiring person. A class or series of shares of the corporation is entitled
to vote as a class or series if any provision of the control share acquisition
would, if contained in a proposed amendment to the articles, entitle the class
or series to vote as a class or series; and
(2) The proposed control share acquisition is
consummated within one hundred eighty days after shareholder approval.
[L 2001,
c 129, pt of §1]
