Mississippi Control Share Act

Miss. Code Ann. tit. 79, ch. 27
in effect

Miss. Code Ann. § 79-27-3 Application of chapter; election to be subject to chapter.

This chapter applies to all issuing public corporations in existence on and after January 1, 1991. A domestic corporation that is not an issuing public corporation but that has one hundred (100) or more shareholders of record and meets one (1) of the requirements set forth in Section 79-27-5(g)(i)(B), or an issuing public corporation to which this chapter does not apply, may elect to be subject to this chapter as an issuing public corporation by amending its articles of incorporation to provide that this chapter shall apply to the corporation as of a specified date and filing the amendment in the office of the Secretary of State on or before such date. Any corporation so electing shall be an “issuing public corporation” for purposes of this chapter.

Miss. Code Ann. § 79-27-5 Definitions.

As used in this chapter: “Acquiring person” means a person who makes or proposes to make, or persons acting as a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934 who make or propose to make, a control share acquisition; but “acquiring person” does not include the issuing public corporation. “Affiliate” means a person who directly or indirectly controls the corporation. “Control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of the corporation, whether through the ownership of voting securities, by contract, or otherwise. A person’s beneficial ownership of ten percent (10%) or more of the voting power of a corporation’s outstanding shares entitled to vote in the election of directors (except a person holding voting power in good faith as an agent, bank, broker, nominee, custodian or trustee for one or more beneficial owners who do not individually or as a group control the corporation) creates a presumption that the person controls the corporation. “All voting power” means the aggregate voting power that the shareholders of an issuing public corporation would have in the election of directors, except for this chapter. “Control shares” means issued and outstanding shares of an issuing public corporation that, except for this chapter, would have voting power when added to all other shares of the issuing public corporation owned of record or beneficially by an acquiring person or in respect to which that acquiring person may exercise or direct the exercise of voting power, that would entitle the acquiring person, immediately after acquisition of the shares (directly or indirectly), to exercise or direct the exercise of the voting power of the issuing public corporation in the election of directors within any of the following ranges of voting power: One-fifth (1/5) or more but less than one-third (1/3) of all voting power; One-third (1/3) or more but less than a majority of all voting power; or A majority or more of all voting power. (i) “Control share acquisition” means acquisition by any person of ownership of, or the power to direct the exercise of voting power with respect to, control shares. A person who acquires shares in the ordinary course of business for the benefit of others in good faith and not for the purpose of circumventing this chapter has not made a control share acquisition of shares in respect of which that person is not able to exercise or direct the exercise of votes without further instruction from others. The acquisition of any control shares does not constitute a control share acquisition if the acquisition is made in good faith and not for the purpose of circumventing this chapter in any of the following circumstances: At a time when the corporation was not subject to this chapter. Pursuant to a contract entered into at a time when the corporation was not subject to this chapter. Pursuant to the laws of descent and distribution under Section 91-1-1 et seq., Mississippi Code of 1972. By a donee under an inter vivos gift. Pursuant to a transfer between or among immediate family members, or between or among persons under direct common control. An “immediate family member” is any relative or spouse of a person, or any relative of such spouse, who has the same home as such person. Pursuant to the satisfaction of a pledge or other security interest. Pursuant to a merger or plan of consolidation or share exchange effected in compliance with Section 79-4-11.01 et seq., Mississippi Code of 1972, if the issuing public corporation is a party to the agreement of merger or plan of consolidation or share exchange. From any person whose previous acquisition of control shares would have constituted a control share acquisition but for this paragraph (e)(iii) (other than this paragraph (e)(iii)(H)), provided the acquisition does not result in the acquiring person holding voting power within a higher range of voting power than that of a person from whom the control shares were acquired. Acquisition by a person of additional shares within the range of voting power for which such person has received approval pursuant to Section 79-27-9 or within the range of voting power resulting from shares acquired in a transaction described in this paragraph (e)(iii). An increase in voting power resulting from any action taken by the issuing public corporation. Pursuant to the solicitation of proxies subject to Regulation 14A under the Securities Exchange Act of 1934. Pursuant to the sale of such shares by the issuing public corporation or its parent or subsidiary corporation. “Interested shares” means the shares of an issuing public corporation in respect of which any of the following persons may exercise or direct the exercise, as of the applicable record date, of the voting power of the corporation in the election of directors, other than solely by the authority of a revocable proxy: The acquiring person. Any officer of the issuing public corporation. Any employee of the issuing corporation who is also a director of the corporation. (i) “Issuing public corporation” means a domestic corporation that has: Any securities registered under Section 12 or is subject to Section 15(d) of the Securities Exchange Act of 1934; and Either: 1. More than ten percent (10%) of its shareholders resident in Mississippi; 2. More than ten percent (10%) of its shares owned by Mississippi residents; or 3. Five hundred (500) shareholders resident in Mississippi. The residence of a shareholder is presumed to be the address appearing in the records of the corporation. Shares held by banks (except as trustee or guardian), brokers or nominees are disregarded for purposes of calculating the percentages and numbers in this paragraph (g). An issuing public corporation shall not include: Any state or national bank or any bank holding company or any affiliate thereof authorized by the appropriate regulatory authority to be owned by any of the above; or Any state or federal savings and loan association, savings bank or similar savings institution, and any holding company or other affiliate of any state or federal savings and loan association, savings bank or similar savings institution. “Person” means any individual, corporation, partnership, unincorporated association or other entity.

Miss. Code Ann. § 79-27-7 Voting power of control shares.

Unless otherwise provided in the articles of incorporation before either a control share acquisition occurs or a disclosure statement is delivered, control shares that are the subject of a control share acquisition have only such voting rights as are accorded under this section. Subject to subsections (3) through (5) of this section, the voting power of control shares having voting power of one-fifth (/f1o5) or more of all voting power is reduced to zero unless the shareholders of the issuing public corporation approve a resolution pursuant to the procedure set forth in Section 79-27-9 according the shares the same voting rights as they had before they became control shares. Except as provided in Section 79-27-9(6), the voting power of control shares representing voting power of less than one-fifth (1/5) of all voting power is not affected by this chapter. If control shares of the acquiring person previously have been accorded (pursuant to the procedure set forth in Section 79-27-9) the same voting rights they had before they became control shares, or if such control shares were acquired in a transaction excluded from the definition of “control share acquisition,” then only the voting power of control shares acquired in a subsequent control share acquisition by such acquiring person within a higher range of voting power shall be reduced to zero. The voting rights of control shares are restored to those accorded such shares prior to the control share acquisition in any of the following circumstances: (a) if, by reason of subsequent issuance of shares or other transactions by the issuing public corporation, the voting power of those control shares is reduced to a range of voting power for which approval has been granted or is not required; or (b) upon transfer to a person other than an acquiring person; or (c) the expiration of three (3) years after the date of a vote of shareholders pursuant to Section 79-27-9 failing to approve the resolution according voting rights to those control shares.

Miss. Code Ann. § 79-27-9 Disclosure requirements when acquiring control shares; special meeting of shareholders; notice; proxies; voting on resolution in disclosure statement; competing control share acquisition.

Any acquiring person who proposes to make a control share acquisition may, and any acquiring person who has made a control share acquisition shall, publish in a newspaper of general circulation and deliver to the issuing public corporation at its principal office a disclosure statement. To be regarded as a disclosure statement, the document must set forth all of the following: The identity of the acquiring person; A statement that the disclosure statement is delivered pursuant to this chapter; The number of shares of the issuing public corporation owned (directly or indirectly) by the acquiring person, the acquisition dates and the prices at which such shares were acquired; The voting power to which the acquiring person, except for Section 79-27-7, would be entitled; A form of the resolution to be considered by the shareholders hereunder; and If the control share acquisition has not yet occurred: A description in reasonable detail of the terms of the proposed control share acquisition; and Representations of the acquiring person, together with a statement in reasonable detail of the facts upon which they are based, that the proposed control share acquisition, if consummated, will not be contrary to law, and that the acquiring person has the financial capacity to make the proposed control share acquisition. If the directors of the issuing public corporation so order, or if the acquiring person so requests at the time of delivery of a disclosure statement and gives an undertaking to pay the issuing public corporation’s expenses in connection therewith, a special meeting of shareholders of the issuing public corporation must be called within ten (10) days after delivery of the disclosure statement for the purpose of considering the resolution relating to the voting rights to be accorded the shares acquired or to be acquired in the control share acquisition. Unless both the acquiring person and the issuing public corporation agree in writing to another date, the special meeting of shareholders must be held not sooner than thirty (30) days nor later than fifty (50) days after receipt by the issuing public corporation of the request or order for a special meeting. If no special meeting of shareholders is called pursuant to subsection (2) of this section, the resolution relating to the voting rights to be accorded the shares acquired in the control share acquisition must be presented to the next special or annual meeting of shareholders. If a special meeting is called, notice of the special meeting of shareholders must be given as promptly as reasonably practicable by the issuing public corporation to all shareholders of record as of the record date set for the meeting. If the special meeting was requested by the acquiring person, the directors shall set the record date on a date not later than fifteen (15) days after the request was received by the issuing public corporation. Notice of the special meeting, or the annual meeting if no special meeting is called, must include or be accompanied by: A copy of the disclosure statement; A statement by the board of directors of its position or recommendation, or that it is taking no position or making no recommendation, with respect to the resolution contained in the disclosure statement; and A description of any dissent and appraisal rights or any redemption procedure that may accompany or result from the vote of shareholders. Any other provisions of this chapter notwithstanding, a proxy relating to a meeting of shareholders to be held pursuant to this section must be solicited separately from the offer to purchase or solicitation of an offer to sell shares of the issuing public corporation. All votes cast at the meeting for or against the resolution contained in the disclosure statement must be identified as noninterested shares. To be approved, the resolution must receive the affirmative votes of a majority of all voting power, excluding all interested shares. If the resolution is not approved, the acquiring person, not sooner than six (6) months thereafter, may present a new resolution for a vote of shareholders in accordance with this section at any subsequent shareholder meeting as long as the voting power of the control shares described in the resolution is reduced. For purposes of this subsection, a “competing control share acquisition” means a control share acquisition that is the subject of a disclosure statement delivered to the issuing public corporation under subsection (1) of this section before a shareholder vote has been held under subsection (7) of this section with respect to a pending control share acquisition. A resolution relating to the voting rights of control shares that are the subject of a pending control share acquisition is not effective unless it receives approval pursuant to subsection (7) of this section and a resolution relating to the voting rights of control shares that are the subject of a competing control share acquisition does not receive such approval. If a resolution applicable to the competing control share acquisition is approved pursuant to subsection (7) of this section, only that resolution is effective. If a resolution relating to a pending control share acquisition has been approved pursuant to subsection (7) of this section before a disclosure statement with respect to another control share acquisition is delivered, the resolution is effective in restoring the voting rights of control shares that are the subject of the pending control share acquisition. If resolutions relating to two (2) or more control share acquisitions are subject to shareholder vote under subsection (7) of this section, shares held by an acquiring person are not considered interested shares with respect to a vote on a resolution relating to a competing control share acquisition. All provisions of the Mississippi Business Corporation Act, Section 79-4-1.01 et seq., Mississippi Code of 1972, that are not inconsistent with the procedures set forth in this section shall apply to the meeting of shareholders of the issuing public corporation.

Miss. Code Ann. § 79-27-11 Acquisition of control shares at time when corporation was not subject to chapter, or pursuant to contract entered into at time when corporation was not subject to chapter.

This section applies to all transactions that, but for Section 79-27-5(e)(iii)(A) and (B), would be control share acquisitions in which: The acquiring person is or includes an affiliate of the issuing public corporation; The corporation has, by a provision in its articles of incorporation adopted within the prior twelve (12) months, elected not to be subject to this chapter; and The acquiring person has acquired a majority or more of all voting power. Within thirty (30) days after a control share acquisition subject to subsection (1) of this section, the acquiring person must make a written offer to purchase the shares of each remaining shareholder at a price at least equal to the highest price at which the control shares were acquired by the acquiring person within the twelve (12) months immediately preceding the offer. Nothing herein shall be construed to preclude the simultaneous application of this section and the Mississippi Shareholder Protection Act, Section 79-25-1 et seq., Mississippi Code of 1972.
Source: Public.Resource.Org MS CodeURL: https://unicourt.github.io/cic-code-ms/transforms/ms/ocms/r78/gov.ms.code.title.79.htmlFetched: 10/18/2026

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