351.407. Control shares acquisition procedures--exceptions.
Control shares acquisition procedures--exceptions.
351.407. 1. Unless, before the control share acquisition,the corporation's articles of incorporation or bylaws providethat this section does not apply to control share acquisitions ofshares of the corporation, control shares of an issuing publiccorporation acquired in a control share acquisition have onlysuch voting rights as are conferred by subsection 5 of thissection.
2. Any person who proposes to make or has made a controlshare acquisition may at the person's election deliver anacquiring person statement to the issuing public corporation atthe issuing public corporation's principal office. The acquiringperson statement must set forth all of the following:
(1) The identity of the acquiring person and each othermember of any group of which the person is a part for purposes ofdetermining control shares;
(2) A statement that the acquiring person statement is givenpursuant to this section;
(3) The number of shares of the issuing public corporationowned, directly or indirectly, by the acquiring person and eachother member of the group;
(4) The range of voting power under which the control shareacquisition falls or would, if consummated, fall;
(5) If the control share acquisition has not taken place:
(a) A description in reasonable detail of the terms of theproposed control share acquisition; and
(b) Representations of the acquiring person, together with astatement in reasonable detail of the facts upon which they arebased, that the proposed control share acquisition, ifconsummated, will not be contrary to law, and that the acquiringperson has the financial capacity to make the proposed controlshare acquisition.
3. (1) If the acquiring person so requests at the time ofdelivery of an acquiring person statement and gives anundertaking to pay the corporation's expenses of a specialmeeting, the directors of the issuing public corporation shallwithin ten days thereafter call a special meeting of shareholdersof the issuing public corporation for the purpose of consideringthe voting rights to be accorded the shares acquired or to beacquired in the control share acquisition.
(2) Unless the acquiring person agrees in writing to anotherdate, the special meeting of shareholders shall be held withinfifty days after receipt of the request by the issuing publiccorporation.
(3) If no request is made, the voting rights to be accordedthe shares acquired in the control share acquisition shall bepresented to the next special or annual meeting of shareholders.
(4) If the acquiring person so requests in writing at thetime of delivery of its acquiring statement pursuant to thissubsection, the special meeting must not be held sooner thanthirty days after receipt by the issuing public corporation ofthe acquiring person statement.
4. (1) If a special meeting is requested, notice of thespecial meeting of shareholders shall be given as promptly asreasonably practicable by the issuing public corporation to allshareholders of record as of the record date set for the meeting,whether or not entitled to vote at the meeting.
(2) Notice of the special or annual shareholder meeting atwhich the voting rights are to be considered must include or beaccompanied by both of the following:
(a) A copy of the acquiring person statement delivered tothe issuing public corporation pursuant to this section; and
(b) A statement by the board of directors of the corporationof its position or recommendation, or that it is taking noposition or making no recommendation, with respect to theproposed control share acquisition.
5. (1) Control shares acquired in a control shareacquisition have the same voting rights as were accorded theshares before the control share acquisition only to the extentgranted by resolution approved by the shareholders of the issuingpublic corporation.
(2) To be approved under this section, the resolution mustbe approved by:
(a) The affirmative vote of a majority of all outstandingshares entitled to vote at such meeting voting by class ifrequired by the terms of such shares; and
(b) Also by the affirmative vote of a majority of alloutstanding shares entitled to vote at such meeting voting byclass if required by the terms of such shares, excluding allinterested shares.
6. If a shareholder shall file with the corporation, priorto or at the meeting of shareholders at which the voting rightsto be accorded any control shares are submitted to a vote, awritten objection to such voting rights being accorded anycontrol shares, and shall not vote in favor thereof, and suchshareholder, within twenty days after approval of voting rightsbeing accorded any control shares, shall make written demand onthe corporation for payment of the fair value of his shares as ofthe day prior to the date on which the vote was taken approvingvoting rights being accorded any control shares, the corporationshall pay to such shareholder, upon surrender of his certificateor certificates representing such shares, the fair value of hisshares. Such demand shall state the number and class of theshares owned by such dissenting shareholder. Any shareholderfailing to make demand within the twenty-day period provided inthis subsection shall be conclusively presumed to have consentedto the control share acquisition.
7. If within thirty days after the date of approval ofvoting rights being accorded any control shares the value of suchshares is agreed upon between the dissenting shareholder and thecorporation, payment for the shares shall be made within ninetydays after approval of voting rights being accorded any controlshares, upon the surrender of his certificate or certificatesrepresenting such shares. Upon payment of the agreed value, thedissenting shareholder shall cease to have any interest in suchshares or in the corporation.
8. If, within the thirty-day period provided in subsection 7of this section, the shareholder and the corporation do not soagree, then the dissenting shareholder may, within sixty daysafter the expiration of such thirty-day period, file a petitionin any court of competent jurisdiction within the county in whichthe registered office of the corporation is situated, asking fora finding and determination of the fair value of such shares, andshall be entitled to judgment against the corporation for theamount of such fair value as of the day prior to the date onwhich such vote was taken approving such control shareacquisition, together with interest thereon to the date of suchjudgment. The judgment shall be payable only upon andsimultaneously with the surrender to the corporation of thecertificate or certificates representing such shares. Upon thepayment of the judgment, the dissenting shareholder shall ceaseto have any interest in such shares, or in the corporation. Suchshares may be held and disposed of by the corporation as it maysee fit. Unless the dissenting shareholder shall file suchpetition within the time provided in this subsection, suchshareholder and all persons claiming under him shall beconclusively presumed to have consented to the control shareacquisition.
9. Except as expressly provided in this section, nothing inthis section shall be construed to affect or impair any right,remedy, obligation, duty, power, or authority of any acquiringperson, any issuing public corporation, the board of directors ofany acquiring person or issuing public corporation, or any otherperson under the laws of this state or any other state of theUnited States of America. The requirements of this section shallbe in addition to, and shall in no way limit, the validly adoptedprovisions of the articles of incorporation of any issuing publiccorporation.
(L. 1984 S.B. 409, A.L. 1987 H.B. 349, A.L. 1989 S.B. 141)