Corporations and Associations (GCA) — Title 3. Corporations in General -- Extraordinary Actions

As the successor; or

As the corporation the stock of which is to be acquired; or

Title 9 of the Maryland Uniform Commercial Code;

The Real Property Article; or

Other applicable law to effect the transfer of assets without the consent of the corporation; or

That results in the reduction or elimination of the liabilities or obligations secured by the assets; and

For which the value of the assets is less than or equal to the amount of the liabilities or obligations being reduced or eliminated.

Provided value for the assets, including the reduction or elimination of the liabilities or obligations secured by the assets; and

Acted in good faith.

A claim for monetary damages arising from the director failing to satisfy the standard of conduct for directors under § 2–405.1(c) of this article, including a claim by or in the right of the corporation; or

A claim for equitable relief.

The merger does not reclassify or change the terms of any class or series of its stock that is outstanding immediately before the merger becomes effective or otherwise amend its charter and the number of its shares of stock of such class or series outstanding immediately after the effective time of the merger does not increase by more than 20% of the number of its shares of the class or series of stock that is outstanding immediately before the merger becomes effective; or

There is no stock outstanding or subscribed for and entitled to be voted on the merger;

For certificated shares, physical receipt of a stock certificate and transfer of the stock certificate into the depository’s account; and

For uncertificated shares, receipt by the depository of confirmation of the transfer of the shares into the depository’s account.

“Subject corporation” means the Maryland corporation that is the subject of a tender or exchange offer under this section.

“Subject corporation” includes a Maryland real estate investment trust as defined in Title 8 of this article.

The shares of the subject corporation are registered under the Securities Exchange Act of 1934 immediately prior to the execution of the agreement to merge by the subject corporation;

The agreement to merge expressly allows or requires the merger to be effected under this section and provides that the merger shall be effected following the consummation of the offer described in item (iii) of this paragraph;

Subject to paragraph (2) of this subsection, an acquiring entity consummates a tender or exchange offer for any and all of the outstanding shares of the subject corporation that would, except for the application of this section, entitle the holder of the outstanding shares to vote on the merger on the terms provided in the agreement to merge;

Following the consummation of the offer, the stock irrevocably accepted for purchase or exchange in accordance with the offer and received by the depository before the expiration of the offer, together with the stock otherwise owned by the acquiring entity, a person that owns, directly or indirectly, all of the outstanding equity interest in the acquiring entity, and a direct or indirect wholly owned subsidiary of the acquiring entity or a person that owns, directly or indirectly, all of the outstanding equity interest in the acquiring entity, equals at least that percentage of the shares, and of each class or series of the shares, of the subject corporation that would, except for the application of this section, be required to approve the merger under this article and the charter of the subject corporation;

The acquiring entity merges with or into the subject corporation; and

Each outstanding share of each class or series of shares of the subject corporation that is the subject of and not irrevocably accepted for purchase or exchange in the offer is converted in the merger into, or into the right to receive, the same amount and kind of cash, property, rights, or securities paid for shares of the class or series of shares of the subject corporation irrevocably accepted for purchase or exchange in the offer.

The acquiring entity;

A person that owns, directly or indirectly, all of the outstanding equity interest in the acquiring entity; or

A direct or indirect wholly owned subsidiary of a person described in item (i) or (ii) of this paragraph.

The board of directors of each Maryland corporation proposing to become a party to the merger shall adopt a resolution that approves the proposed merger on substantially the terms and conditions set forth or referred to in the resolution.

The approval shall be by a majority vote of the entire board of directors.

A meeting of the stockholders is not necessary.

Provisions, if any, regarding the incorporator or incorporators, the principal office, the resident agent, and the initial board of directors;

Provisions authorized under § 2–605 of this article; and

Any amendment to the charter that was necessary to effect a change, exchange, reclassification, subdivision, combination, or cancellation of stock, if the change, exchange, reclassification, subdivision, combination, or cancellation of stock has become effective;

The restrictions shall apply to the holding company and the stockholders of the holding company immediately after the effective time of the merger as though the holding company was the parent company;

For purposes of § 3–602 of this title, all shares of stock of the holding company acquired in the merger shall be deemed to have been acquired at the time that the shares of stock of the parent corporation converted in the merger were acquired; and

Each party to the articles; and

The successor corporation in a consolidation, merger, or share exchange or the successor domestic partnership, limited partnership or limited liability company in a merger;

The date of its incorporation;

A statement whether it is incorporated under general law or by special act and, if incorporated by special act, the chapter number and year of passage; and

If the corporation is registered or qualified to do business in this State, the date of its registration or qualification;

The date of its organization; and

If the business trust is registered or qualified to do business in this State, the date of its registration or qualification;

The date of its formation; and

If the foreign partnership, limited partnership or limited liability company is registered or qualified to do business in this State, the date of its registration or qualification;

Each corporation, partnership, limited partnership, limited liability company, and business trust party to the articles has its principal office; and

Any of the parties in a consolidation or merger, other than the successor, owns an interest in land;

The location of its principal office in the place where it is organized; and

The name and address of its resident agent in the place where it is organized;

The total number of shares of stock of all classes which the corporation has authority to issue;

The number of shares of stock of each class;

The par value of the shares of stock of each class or a statement that the shares are without par value; and

If there are any shares of stock with par value, the aggregate par value of all the shares of all classes; and

Any amendment to the charter, certificate of limited partnership, articles of organization, or declaration of trust of the successor to be effected as part of the merger; and

The restatement, if a restatement of the charter, the certificate of limited partnership, articles of organization, or declaration of trust of the successor is to be effected as a part of the merger;

The total number of shares of stock of all classes or series which the corporation has authority to issue;

The number of shares of stock of each class or series;

The par value of the shares of stock of each class or series or a statement that the shares are without par value; and

If there are any shares of stock with par value, the aggregate par value of all the shares of all classes or series;

The total number of shares of beneficial interest of all classes and series which the business trust has authority to issue; and

The number of shares of beneficial interest of each class and series;

The total number of shares of stock of all classes which the corporation has authority to issue;

The number of shares of stock of each class;

The par value of the shares of stock of each class or a statement that the shares are without par value; and

If there are any shares of stock with par value, the aggregate par value of all the shares of all classes; and

Provide a deed reference or other description sufficient to identify the property; and

State the actual consideration paid or to be paid for the property.

The time specified by the law of the place where the successor is organized; or

The time the Department accepts the articles of consolidation or merger for record.

By its last acting officers, general partners, authorized persons, or trustees; or

By the appropriate officers, general partners, authorized persons, or trustees of the successor.

By its current officers; or

If the corporation no longer exists, by its last acting officers.

Each county in this State where a foreign corporation party to the consolidation or merger, except the successor, owned an interest in land;

The name of each corporation party to the consolidation or merger;

The place under the laws of which each party was organized; and

The name of the successor.

The right to acquire voting stock (whether the right is exercisable immediately or within 60 days after the date on which beneficial ownership is determined), in accordance with any agreement, arrangement, or understanding, on the exercise of conversion rights, exchange rights, warrants, or options, or otherwise; or

Except solely by virtue of a revocable proxy, the right to vote voting stock in accordance with any agreement, arrangement, or understanding; or

With respect to a merger under § 3–106 or § 3–106.1 of this title, on the day notice is given or waived under § 3–106 or § 3–106.1 of this title; or

With respect to any other transaction, on the day the stockholders voted on the transaction objected to.

With respect to a merger under § 3–106 or § 3–106.1 of this title, on the date notice is given or waived under § 3–106 or § 3–106.1 of this title; or

With respect to any other transaction, on the record date for determining stockholders entitled to vote on the transaction objected to;

The merger alters the contract rights of the stock as expressly set forth in the charter, and the charter does not reserve the right to do so; or

The stock is to be changed or converted in whole or in part in the merger into something other than either stock in the successor or cash, scrip, or other rights or interests arising out of provisions for the treatment of fractional shares of stock in the successor;

Stock of the corporation surviving or resulting from the merger, consolidation, or share exchange, stock of any other corporation, or depositary receipts for any stock described in this item;

Cash in lieu of fractional shares of stock or fractional depositary receipts described in item (i) of this item; or

Any combination of the stock, depositary receipts, and cash in lieu of fractional shares or fractional depositary receipts described in items (i) and (ii) of this item;

The day the stockholders voted on the transaction objected to; or

With respect to a merger under § 3–106 or § 3–106.1 of this title, the effective date of the merger; and

With respect to a merger under § 3–106 or § 3–106.1 of this title, within 30 days after notice is given or waived under § 3–106 or § 3–106.1 of this title; or

With respect to any other transaction, at or before the stockholders’ meeting at which the transaction will be considered or, in the case of action taken under § 2–505(b) of this article, within 10 days after the corporation gives the notice required by § 2–505(b) of this article;

Within 20 days after the Department accepts the articles for record; or

Within 20 days after consummation of the transfer or transaction with respect to:

A balance sheet as of a date not more than six months before the date of the offer;

A profit and loss statement for the 12 months ending on the date of the balance sheet; and

Any other information the successor considers pertinent.

Determine the fair value of the stock and enter judgment for the stockholder; or

Remit the proceedings to the same or other appraisers on terms and conditions it considers proper.

The price which the successor offered for the stock;

The financial statements and other information furnished to the stockholder; and

Any other circumstances it considers relevant.

The price which the successor offered for the stock;

The financial statements and other information furnished to the stockholder; and

Any other circumstances it considers relevant.

The successor did not make an offer for the stock under § 3-207 of this subtitle; or

The value of the stock determined in the proceeding materially exceeds the amount offered by the successor.

Any director or stockholder may call a meeting of the stockholders by giving notice in the manner required by Title 2 of this article, stating the purpose of the meeting; and

The stockholders or their successors in interest present at the meeting in person or by proxy, whether or not sufficient to constitute a quorum, may elect a board consisting of the lesser of the number of directors required by the charter and bylaws of the corporation, or 3 directors, who may sign and acknowledge the articles and do all acts necessary and proper to revive the charter of the corporation.

Find that legal cause for forfeiture has been shown and that the public interest requires a forfeiture;

Declare the charter forfeited and the corporation dissolved; and

Appoint a receiver of the assets of the corporation.

The right to acquire voting stock (whether the right is exercisable immediately or only after the passage of time), in accordance with any agreement, arrangement, or understanding, on the exercise of conversion rights, exchange rights, warrants, or options, or otherwise; or

Except solely by virtue of a revocable proxy, the right to vote voting stock in accordance with any agreement, arrangement, or understanding; or

Is the beneficial owner, directly or indirectly, of 10 percent or more of the voting power of the outstanding voting stock of the corporation after the date on which the corporation had 100 or more beneficial owners of its stock; or

Is an affiliate or associate of the corporation and was the beneficial owner, directly or indirectly, of 10 percent or more of the voting power of the then outstanding stock of the corporation:

For a business combination voted upon by stockholders, the latter of the day prior to the date of the stockholders’ vote or the day 20 days prior to the consummation of the business combination; and

For a business combination not voted upon by stockholders, the date of the consummation of the business combination.

The highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers’ fees) paid by the interested stockholder for any shares of common stock of the same class or series acquired by it within the 5–year period immediately prior to the announcement date of the proposal of the business combination, plus an amount equal to interest compounded annually from the earliest date on which the highest per share acquisition price was paid through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of common stock from the earliest date through the valuation date, up to the amount of the interest; or

The highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers’ fees) paid by the interested stockholder for any shares of common stock of the same class or series acquired by it on, or within the 5–year period immediately before, the determination date, plus an amount equal to interest compounded annually from the earliest date on which the highest per share acquisition price was paid through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of common stock from the earliest date through the valuation date, up to the amount of the interest; or

The market value per share of common stock of the same class or series on the announcement date, plus an amount equal to interest compounded annually from that date through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of common stock from that date through the valuation date, up to the amount of the interest; or

The market value per share of common stock of the same class or series on the determination date, plus an amount equal to interest compounded annually from that date through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of common stock from that date through the valuation date, up to the amount of the interest; or

The price per share equal to the market value per share of common stock of the same class or series on the announcement date or on the determination date, whichever is higher, multiplied by the fraction of:

The highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers’ fees) paid by the interested stockholder for any shares of such class or series of stock acquired by it within the 5–year period immediately prior to the announcement date of the proposal of the business combination, plus an amount equal to interest compounded annually from the earliest date on which the highest per share acquisition price was paid through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of the class or series of stock from the earliest date through the valuation date, up to the amount of the interest; or

The highest per share price (including any brokerage commissions, transfer taxes and soliciting dealers’ fees) paid by the interested stockholder for any shares of such class or series of stock acquired by it on, or within the 5–year period immediately prior to, the determination date, plus an amount equal to interest compounded annually from the earliest date on which the highest per share acquisition price was paid through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of the class or series of stock from the earliest date through the valuation date, up to the amount of the interest; or

The highest preferential amount per share to which the holders of shares of such class or series of stock are entitled in the event of any voluntary or involuntary liquidation, dissolution or winding up of the corporation; or

The market value per share of such class or series of stock on the announcement date, plus an amount equal to interest compounded annually from that date through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of the class or series of stock from that date through the valuation date, up to the amount of the interest; or

The market value per share of such class or series of stock on the determination date, plus an amount equal to interest compounded annually from that date through the valuation date at the rate for 1–year United States Treasury obligations from time to time in effect, less the aggregate amount of any cash dividends paid and the market value of any dividends paid in other than cash, per share of the class or series of stock from that date through the valuation date, up to the amount of the interest; or

The price per share equal to the market value per share of such class or series of stock on the announcement date or on the determination date, whichever is higher, multiplied by the fraction of:

After the determination date and prior to the consummation of such business combination:

The provisions of subparagraph (i)1 and 2 of this paragraph do not apply if no interested stockholder or an affiliate or associate of the interested stockholder voted as a director of the corporation in a manner inconsistent with subparagraph (i)1 and 2 of this paragraph and the interested stockholder, within 10 days after any act or failure to act inconsistent with subparagraph (i)1 and 2 of this paragraph, notifies the board of directors of the corporation in writing that the interested stockholder disapproves thereof and requests in good faith that the board of directors rectify such act or failure to act.

Prior to September 1, 1983 or such earlier date as may be irrevocably established by resolution of the board of directors; or

If involving transactions with a particular interested stockholder or its existing or future affiliates, at any time prior to the most recent time that the interested stockholder became an interested stockholder.

A close corporation as defined in § 4–101(b) of this article;

A corporation having fewer than 100 beneficial owners of its stock;

A corporation whose original articles of incorporation have a provision, or whose stockholders adopt a charter amendment after June 30, 1983 by a vote of at least 80 percent of the votes entitled to be cast by outstanding shares of voting stock of the corporation, voting together as a single voting group, and two–thirds of the votes entitled to be cast by persons (if any) who are not interested stockholders of the corporation or affiliates or associates of interested stockholders, voting together as a single voting group, expressly electing not to be governed by the provisions of § 3–602 of this subtitle in whole or in part, or in either case as to business combinations, specifically, generally, or generally by types, or as to identified or unidentified existing or future interested stockholders or their affiliates, provided that, other than in the case of the original articles of incorporation, an amendment may not be effective until 18 months after the vote of stockholders and may not apply to any business combination of the corporation with an interested stockholder (or any affiliate of the interested stockholder) who became an interested stockholder on or before the date of the vote;

A corporation registered under the Investment Company Act of 1940 as an open end investment company;

A corporation registered under the Investment Company Act of 1940 as a closed end investment company unless its board of directors adopts a resolution to be subject to § 3–602 of this subtitle on or after June 1, 2000, provided that the resolution shall not be effective with respect to a business combination with any person who has become an interested stockholder before the time that the resolution is adopted; or

A corporation with an interested stockholder that became an interested stockholder inadvertently, if the interested stockholder:

Directly or indirectly controls, or is controlled by, or is under common control with, the person specified; or

Is acting or intends to act jointly or in concert with the person specified.

Before November 4, 1988;

Under a contract made before November 4, 1988;

Under the laws of descent and distribution;

Under the satisfaction of a pledge or other security interest created in good faith and not for the purpose of circumventing this subtitle;

Under a merger, consolidation, or share exchange effected under Subtitle 1 of this title if the corporation is a party to the merger, consolidation, or share exchange;

Within one–tenth or more but less than one–fifth of all voting power of outstanding shares of stock of the corporation before June 1, 2000;

At a time when the corporation is not subject to this subtitle; or

In accordance with a contract entered into at a time when the corporation is not subject to this subtitle.

Any person whose voting rights have previously been authorized by stockholders in compliance with this subtitle; or

Any person whose previous acquisition of shares of stock of the corporation would have constituted a control share acquisition but for paragraph (2) of this subsection.

One–tenth or more, but less than one–third of all voting power;

One–third or more, but less than a majority of all voting power; or

A majority or more of all voting power.

Shares of stock of a corporation only to the extent that the acquiring person, following the acquisition of the shares, is entitled, directly or indirectly, to exercise or direct the exercise of voting power within any level of voting power set forth in this section for which approval has not been obtained previously under § 3–702 of this subtitle; and

Shares of stock acquired within any range of voting power described in paragraph (1) of this subsection, even if the initial shares acquired within the applicable range of voting power are excluded from a control share acquisition.

Is acting in the ordinary course of business, in good faith and not for the purpose of circumventing the provisions of this section; and

Is not entitled to exercise or to direct the exercise of the voting power of the shares unless the person first seeks to obtain the instruction of another person.

The proposed control share acquisition, if consummated, will not be contrary to law; and

The acquiring person has the financial capacity, through financing to be provided by the acquiring person and any additional specified sources of financing required under § 3–705 of this subtitle, to make the proposed control share acquisition.

The right to acquire stock (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

The right to vote stock pursuant to any agreement, arrangement, or understanding; or

Its charter or bylaws; or

A resolution of its board of directors.

Are not officers or employees of the corporation;

Are not acquiring persons;

Are not directors, officers, affiliates, or associates of an acquiring person; and

Were not nominated or designated as directors by an acquiring person.

Owns securities issued by the corporation;

Is entitled to compensation, retirement, severance, or other benefits as a director of the corporation; or

Might continue to serve as a director of the corporation or become a director of an acquiring person.

The corporation elects to be subject to any or all provisions of this subtitle by resolution of the board of directors or bylaw amendment; or

The board of directors adopts a resolution in accordance with subsection (c) of this section that prohibits the corporation from electing to be subject to any or all provisions of this subtitle.

Has elected to become subject; or

May not elect to become subject in accordance with the resolution of the board.

An increase in the size of the board of directors; or

The death, resignation, or removal of a director.

For the remainder of the full term of the class of directors in which the vacancy occurred; and

Until a successor is elected and qualifies.

The corporation or other entity, as applicable;

The directors, partners, members, trustees, officers, or other agents of the corporation or other entity; and

Any other person affiliated with the corporation or other entity; and

The location of the principal office in the place where it is organized; and