Effective - 28 Aug 1975
351.205. Preferred shares issued before November 21, 1943, without redemption provisions, how redeemed. — 1. Any corporation which issued preferred shares prior to November 21, 1943, the issued certificates evidencing which shares contain no provision for redemption, and which corporation has no provision in its articles of incorporation providing for the redemption of such shares, may redeem all of such shares at the par or stated value thereof plus, in the case of cumulative preferred shares, an amount equal to all accrued and unpaid dividends thereon to the date of redemption; provided, that the corporation shall proceed in the following manner:
(1) The board of directors may adopt a resolution recommending the redemption and directing the submission of the resolution for approval or rejection by a vote of all the shareholders of the corporation, each share entitling the holder to one vote, whether by the terms of the articles of incorporation the shareholder is entitled to vote or not, and such vote may be at either an annual or a special meeting, except that the proposed redemption need not be adopted by the board of directors and may be directly submitted to any annual or special meeting of shareholders;
(2) Written or printed notice stating that the purpose, or one of the purposes, of the meeting is to consider and vote upon the adoption or rejection of a resolution providing for the redemption of the preferred shares shall be given to each shareholder of record within the time and in the manner provided by this chapter for the giving of notice of meetings of shareholders; if the meeting is an annual meeting, the purpose shall, nevertheless, be included in the notice of the annual meeting;
(3) At the meeting the shareholders may adopt the resolution for the redemption of all of such preferred shares, and may authorize the board of directors to fix the terms and conditions thereof. The authorization shall require the affirmative vote of the holders of at least three-fifths of the outstanding shares of the corporation. In the event that the redemption of the preferred shares is authorized by a vote of the shareholders of the corporation, any holder of a preferred share or of preferred shares who did not vote in favor thereof, and who, at or prior to the meeting at which the redemption was submitted to a vote of the shareholders, shall file with the corporation written objections thereto, may, within twenty days after the vote was taken, make written demand on the corporation for the payment to him of the fair value of his preferred shares as of the day prior to the date on which the vote was taken authorizing the redemption. The demand shall state the number of preferred shares owned by the dissenting shareholder. Any shareholder failing to make demand within the twenty-day period shall be conclusively presumed to have consented to the redemption of the preferred shares at their par or stated value plus, in the case of cumulative preferred shares, an amount equal to all accrued and unpaid dividends thereon to the date of redemption, and shall be bound by the terms of the resolution.
2. If, within thirty days after the date on which the vote was taken, the value of the preferred shares is agreed upon between the dissenting shareholder and the corporation, the corporation shall make payment of the agreed value within ninety days after the date on which the vote was taken authorizing the redemption, upon the surrender of the certificate or certificates representing the shares. Upon payment of the agreed value, the dissenting shareholder shall cease to have any interest in the shares.
3. If within the period of thirty days, the shareholder and the corporation do not so agree, then the dissenting shareholder may, within sixty days after the expiration of the thirty-day period, file a petition in any court of competent jurisdiction within the county in which the registered office of the corporation is situated, asking for a finding and determination of the fair value of the shares, and shall be entitled to judgment against the corporation for the amount of the fair value as of the day prior to the day upon which the vote was taken, together with interest thereon to the date of the judgment. The judgment shall be payable only upon and simultaneously with the surrender to the corporation of the certificate or certificates representing the shares. Upon the payment of the judgment, the dissenting shareholder shall cease to have any interest in the shares. Unless the dissenting shareholder shall file the petition within the time limited, the shareholder and all persons claiming under him shall be conclusively presumed to have approved and ratified the resolution for redemption voted for by the shareholders, as herein provided for, and shall be bound by the terms thereof.
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(L. 1943 p. 410 § 13a, A.L. 1965 p. 532, A.L. 1975 S.B. 14)