SB-0357, As Passed House, September 12, 2013

HOUSE SUBSTITUTE FOR

SENATE BILL NO. 357

     A bill to amend 1972 PA 284, entitled

"Business corporation act,"

by amending section 778 (MCL 450.1778), as amended by 1993 PA 91.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 778. (1) "Equity security" means any 1 of the following:

     (a) Any stock or similar security, certificate of interest, or

participation in any profit sharing agreement, voting trust

certificate, or voting share.

     (b) Any security that is convertible, with or without

consideration, into an equity security, or any warrant or other

security carrying that carries any right to subscribe to or

purchase an equity security.

     (c) Any put, call, straddle, or other option or privilege of

buying an equity security from or selling an equity security to

another person without being bound to do so.

     (2) "Interested Subject to subsection (3), "interested

shareholder" means any person, other than the corporation or any

subsidiary, who is either:that is either of the following:

     (a) The beneficial owner, directly or indirectly, of 10% or

more of the voting power of the outstanding voting shares of the

corporation.

     (b) An affiliate of the corporation and at any time within the

2-year period immediately prior to before the date in question was

the beneficial owner, directly or indirectly, of 10% or more of the

voting power of the then outstanding voting shares of the

corporation.

(3) (c) For Both of the following apply for the purpose of

determining whether a person is an interested shareholder pursuant

to subdivision (a) under subsection (2)(a) or (b): , the

     (a) The number of shares of voting shares considered to be

outstanding shall include includes all voting shares that are owned

by the person except for those shares which may be that are

issuable pursuant to under any agreement, arrangement, or

understanding, or upon on the exercise of conversion rights,

warrants or options, or otherwise.

     (b) Voting shares acquired by the person from the corporation

or acquired in a public offering by or on behalf of the

corporation, whether acquired before or after the effective date of

the amendatory act that added this subdivision, are not considered

to be outstanding or beneficially owned by that person, unless the

corporation determines otherwise by a resolution of the board

adopted before the person acquired those voting shares.

(4) (3) "Market value" means either of the following:

     (a) With respect to shares, the highest closing sale price

during the 30-day period immediately preceding the date in question

of a share as that is listed on any of the following:

     (i) The composite tape for New York stock exchange—listed

securities.

     (ii) If not listed pursuant to under subparagraph (i), the New

York stock exchange.

     (iii) If not listed pursuant to under subparagraph (i) or (ii),

the principal United States security exchange registered under the

securities exchange act of 1934, 48 Stat. 881.15 USC 78a to 78pp.

     (iv) If not listed pursuant to under subparagraph (i), (ii), or

(iii), the highest closing bid quotation during the 30-day period

preceding the date in question as listed on the national

association of securities dealers, inc. automated quotations system

or any other system then in use.

     (v) If a listing is not available pursuant to under

subparagraphs (i) to (iv), then, the fair market value of the shares,

on the date in question, as determined in good faith by the

corporation's board of directors.

     (b) With respect to property other than cash or shares, the

fair market value of the property on the date in question, as

determined in good faith by the corporation's board of directors.

(5) (4) "Subsidiary" means a legal entity of which a majority

of the voting shares is are owned, directly or indirectly, by

another person.