2016 Kentucky Revised Statutes CHAPTER 271B - BUSINESS CORPORATIONS Subtitle 12 - Sale of Assets; Business Combinations 271B.12-200 Definitions for KRS 271B.12-210 to 271B.12-230.
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271B.12-200 Definitions for KRS 271B.12-210 to 271B.12-230.
As used in KRS 271B.12-210 to 271B.12-230:
(1) "Affiliate," including the term "affiliated person," means a person who directly, or
indirectly through one (1) or more intermediaries, controls, or is controlled by, or is
under common control with, a specified person.
(2) "Associate," when used to indicate a relationship with any person, means:
(a) Any corporation or organization (other than the corporation or a subsidiary of
the corporation) of which such person is an officer, director or partner or is,
directly or indirectly, the beneficial owner of ten percent (10%) or more of any
class of equity securities;
(b) 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
(c) Any relative or spouse of such person, or any relative of such spouse, any one
(1) of whom has the same home as such person or is a director or officer of
the corporation or any of its affiliates.
(3) "Beneficial owner," when used with respect to any voting stock, means a person:
(a) Who, individually or with any of its affiliates or associates, beneficially owns
voting stock, directly or indirectly; or
(b) Who, individually or with any of its affiliates or associates, has:
1.
The right to acquire voting stock, whether such right is exercisable
immediately or only after the passage of time and whether or not such
right is exercisable only after specified conditions are met, pursuant to
any agreement, arrangement, or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise;
2.
The right to vote voting stock pursuant to any agreement, arrangement,
or understanding; or
3.
Any agreement, arrangement, or understanding for the purpose of
acquiring, holding, voting or disposing of voting stock with any other
person who beneficially owns, or whose affiliates or associates
beneficially own, directly or indirectly, such shares of voting stock;
however, for the purposes of this section and KRS 271B.12-230 the
beneficial owner of any voting stock held by, or owned through
participation in, any purchase, savings, option, bonus, appreciation,
profit sharing, thrift, incentive, pension, stock ownership or similar plan
for employees or officers of the corporation or any of its subsidiaries
shall be deemed to be the shareholder of record of such voting stock as
shown on the stock transfer books of the corporation.
(4) "Business combination" means:
(a) Unless the merger or consolidation does not alter the contract rights of the
stock as expressly set forth in the articles of incorporation or change or
convert in whole or in part the outstanding shares of stock of the corporation,
(b)
(c)
(d)
(e)
(f)
any merger or consolidation of the corporation or any subsidiary with any
interested shareholder or any other corporation, whether or not itself an
interested shareholder, which is, or after the merger or consolidation would
be, an affiliate or associate of an interested shareholder who was an interested
shareholder prior to the transaction;
Any sale, lease, transfer, or other disposition, other than in the ordinary course
of business, in one (1) transaction or a series of transactions in any twelvemonth period, to any interested shareholder or any affiliate or associate of any
interested shareholder, other than the corporation or any subsidiaries, of any
assets of the corporation or any subsidiary having, measured at the time the
transaction or transactions are approved by the board of directors of the
corporation, an aggregate book value as of the end of the corporation's most
recently ended fiscal quarter of five percent (5%) or more of the total market
value of the outstanding stock of the corporation or of its net worth as of the
end of its most recently ended fiscal quarter;
The issuance or transfer by the corporation, or any subsidiary, in one
transaction or a series of transactions in any twelve-month period, of any
equity securities of the corporation or any subsidiary which have an aggregate
market value of five percent (5%) or more of the total market value of the
outstanding stock of the corporation, determined as of the end of the
corporation's most recently ended fiscal quarter prior to the first such issuance
or transfer, to any interested shareholder or any affiliate or associate of any
interested shareholder, other than the corporation or any of its subsidiaries,
except pursuant to the exercise of warrants or rights to purchase securities
offered pro rata to all holders of the corporation's voting stock or any other
method affording substantially proportionate treatment to the holders of
voting stock;
The adoption of any plan or proposal for the liquidation or dissolution of the
corporation in which anything other than cash will be received by an
interested shareholder or any affiliate or associate of any interested
shareholder; or
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 which has the
effect, directly or indirectly, in one transaction or a series of transactions, of
increasing by five percent (5%) or more the proportionate amount of the
outstanding shares of any class of equity securities of the corporation or any
subsidiary which is directly or indirectly beneficially owned by any interested
shareholder or any affiliate or associate of any interested shareholder; or
Any receipt by an interested shareholder or any affiliate or associate of such
interested shareholder of the benefit directly or indirectly, except
proportionately as a shareholder of such corporation, of any loans, advances,
guaranties, pledges or other financial assistance, or any tax credits or other tax
advantages provided by or through such corporation.
(5)
(6)
"Common stock" means any stock other than preferred or preference stock.
"Continuing director" means any member of the board of directors who is not an
affiliate or associate of an interested shareholder or any of its affiliates, other than
the corporation or any of its subsidiaries, and who was a director of the corporation
prior to the time the interested shareholder became an interested shareholder, and
any successor to such continuing director who is not an affiliate or associate of an
interested shareholder or any of its affiliates, other than the corporation or any of its
subsidiaries, and was recommended or elected by a majority of the continuing
directors at a meeting at which a quorum consisting of a majority of the continuing
directors is present.
(7) "Control," including the terms "controlling," "controlled by" and "under common
control with," means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a person, whether through the
ownership of voting securities, by contract, or otherwise, and the beneficial
ownership of ten percent (10%) or more of the votes entitled to be cast by a
corporation's voting stock creates a presumption of control.
(8) "Equity security" means:
(a) Any stock or similar security, certificate of interest, or participation in any
profit-sharing agreement, voting trust certificate, or certificate of deposit for
the foregoing;
(b) Any security convertible, with or without consideration, into an equity
security, or any warrant or other security carrying any right to subscribe to or
purchase an equity security; or
(c) Any put, call, straddle, or other option, right or privilege of acquiring an
equity security from or selling an equity security to another without being
bound to do so.
(9) "Independent member" of the board of directors means any director who is not an
officer or full-time employee of the corporation or an affiliate or associate of an
interested shareholder or any of its affiliates.
(10) "Interested shareholder" means any person, other than the corporation or any of its
subsidiaries, who:
(a) Is the beneficial owner, directly or indirectly, of ten percent (10%) or more of
the voting power of the outstanding voting stock of the corporation; or is an
affiliate of the corporation and at any time within the five (5) year period
immediately prior to the date in question was the beneficial owner, directly or
indirectly, of ten percent (10%) or more of the voting power of the then
outstanding voting stock of the corporation. The term interested shareholder
shall not mean any entity or person holding or owning voting stock for, or
through participation in, any purchase, savings, option, bonus, appreciation,
profit sharing, thrift, incentive, pension, stock ownership or similar plan for
employees or officers of the corporation or any of its subsidiaries.
(b) For the purpose of determining whether a person is an interested shareholder,
the number of shares of voting stock deemed to be outstanding shall include
shares deemed owned by the person through application of subsection (3) of
this section, but shall not include any other shares of voting stock which may
be issuable pursuant to any agreement, arrangement, or understanding, or
upon exercise of conversion rights, warrants or options, or otherwise.
(11) "Market value" means:
(a) In the case of stock, the highest closing sale price during the thirty-day period
immediately preceding the date in question of a share of such stock on the
composite tape for 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 on which such
stock is listed, or, if such stock is not listed on any such exchange, the highest
closing bid quotation with respect to a share of such stock during the thirtyday period preceding the date in question on the National Association of
Securities Dealers, Inc., Automated Quotations 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 a majority of the continuing
directors at a meeting of the board of directors at which a quorum consisting
of at least a majority of the continuing directors is present; and
(b) 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 a majority of the continuing
directors at a meeting of the board of directors at which a quorum consisting
of at least a majority of the continuing directors is present.
(12) "Subsidiary" means any corporation of which voting stock having a majority of the
votes entitled to be cast is owned, directly or indirectly, by the corporation.
(13) "Voting stock" means shares of capital stock of a corporation entitled to vote
generally in the election of directors.
Effective: July 15, 1988
History: Amended 1988 Ky. Acts ch. 22, sec. 1, effective July 15, 1988. -- Created
1984 Ky. Acts ch. 355, sec. 1, effective July 13, 1984.
Formerly codified as KRS 271A.396.
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