Public Act 90-0461 of the 90th General Assembly

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Public Act 90-0461

HB0613 Enrolled                                LRB9002696WHpk

    AN ACT to amend the Business Corporation Act of  1983  by
changing Sections 7.85 and 11.75.

    Be  it  enacted  by  the People of the State of Illinois,
represented in the General Assembly:

    Section 5.  The  Business  Corporation  Act  of  1983  is
amended by changing Sections 7.85 and 11.75 as follows:

    (805 ILCS 5/7.85) (from Ch. 32, par. 7.85)
    Sec.   7.85.   A.  Vote  required  for  certain  business
combinations.
    A.  This Section shall apply to any domestic  corporation
that   which  (i)  has  any  a  class  of  equity  securities
registered under Section 12 of the Securities Exchange Act of
1934 or is subject to Section 15(d) of that Act (a "reporting
company") and (or any subsequent  provisions  replacing  such
Act),  or  (ii)  any  domestic  corporation  other  than  one
described  in  (i) that which either specifically adopts this
Section 7.85 in its original  articles  of  incorporation  or
amends  its  articles  of incorporation to specifically adopt
this Section 7.85, however,  the  restrictions  contained  in
this  Section  shall  not  apply  in  the event of any of the
following:.
         (1)  In   case   of   a   reporting   company,   the
    corporation's articles of incorporation immediately prior
    to the time it becomes a  reporting  company  contains  a
    provision  expressly  electing not to be governed by this
    Section.
         (2)  The corporation, by  action  of  its  board  of
    directors,  adopts  an amendment to its by-laws within 90
    days after the effective date of this amendatory  Act  of
    1997  expressly  electing  not  to  be  governed  by this
    Section, which amendment shall not be further amended  by
    the board of directors.
         (3)  In   the  case  of  a  reporting  company,  the
    corporation, by action of  its  shareholders,  adopts  an
    amendment  to  its  articles  of incorporation or by-laws
    expressly electing not to be governed  by  this  Section,
    provided  that, in addition to any other vote required by
    law, such amendment to the articles of  incorporation  or
    by-laws  must  be  approved  by the affirmative vote of a
    majority of the voting shares (as defined in paragraph  B
    of  this  Section 7.85).  An amendment adopted under this
    paragraph shall not be effective until  12  months  after
    the  adoption  of  the amendment and shall not apply to a
    business combination between the corporation and a person
    who became an interested shareholder of  the  corporation
    at  the  same  time  as  or  before  the  adoption of the
    amendment.   A  by-law  amendment  adopted   under   this
    paragraph  shall  not  be further amended by the board of
    directors.
         (4)  A shareholder becomes an interested shareholder
    inadvertently  and  (i)  as  soon  as  practical  divests
    sufficient shares so that the shareholder ceases to be an
    interested shareholder and (ii) would not,  at  any  time
    within  the  3  year period immediately before a business
    combination between the corporation and the  shareholder,
    have   been   an   interested  shareholder  but  for  the
    inadvertent acquisition.
    In the case of circumstances described  in  subparagraphs
(1), (2), and (3) of this paragraph A, the election not to be
governed  may be in whole or in part, generally, or generally
by types, or as to specifically  identified  or  unidentified
interested shareholders. Notwithstanding any other provisions
of  the  Articles  of  Incorporation  or  the  By-Laws of the
corporation (and  notwithstanding  the  fact  that  a  lesser
percentage   may   be  specified  by  law,  the  Articles  of
Incorporation  or  the  By-Laws  of  the  corporation),   the
affirmative  vote  of  (i)  the holders of 80% or more of the
combined voting power of the then outstanding  Voting  Shares
voting together as a single class, and (ii) a majority of the
combined  voting  power of the then outstanding Voting Shares
held by Disinterested Shareholders (as hereinafter  defined),
voting  together  as  a  single  class,  shall be required to
amend, or repeal, or  to  adopt  any  provision  inconsistent
with,  any  provision in the Articles of Incorporation of the
corporation specifically adopting this Section 7.85.
    B. (1)  Higher vote for  certain  business  combinations.
In  addition  to  any affirmative vote required by law or the
articles of  incorporation,  except  as  otherwise  expressly
provided  in paragraph C B of this Section 7.85, any business
combination:
    (a)  any merger, consolidation or share exchange  of  the
corporation  or  any Subsidiary (as hereinafter defined) with
or involving (1) any Interested Shareholder  (as  hereinafter
defined)  or (2) any other corporation (whether or not itself
an Interested Shareholder) which is, or  after  such  merger,
consolidation  or  share  exchange would be, an Affiliate (as
hereinafter defined) or an Associate (as hereinafter defined)
of an Interested Shareholder;
    (b)  any  sale,  lease,   exchange,   mortgage,   pledge,
transfer or other disposition (in one transaction or a series
of transactions) to or with any Interested Shareholder or any
Affiliate  or  Associate of any Interested Shareholder (other
than the corporation or any Subsidiary) of any assets of  the
corporation or any Subsidiary having an aggregate Fair Market
Value  (as  hereinafter  defined) equal to 10% or more of the
corporation's consolidated net worth  as  of  its  then  most
recent fiscal year end;
    (c)  the  issuance  or transfer by the corporation or any
Subsidiary (in one transaction or a series  of  transactions)
of any securities of the corporation or any Subsidiary to any
Interested  Shareholder  or any Affiliate or Associate of any
Interested Shareholder;
    (d)  the  adoption  of  any  plan  or  proposal  for  the
liquidation or dissolution of the corporation proposed by, or
in which anything other than cash will  be  received  by,  an
Interested  Shareholder  or  any Affiliate or Associate of an
Interested Shareholder; or
    (e)  any reclassification of  securities  (including  any
reverse share split), or recapitalization of the corporation,
or  any  merger,  consolidation  or  share  exchange  of  the
corporation  with  or involving any of its Subsidiaries which
has the effect, directly or  indirectly,  of  increasing  the
proportionate share of the outstanding shares of any class of
equity  or  convertible  securities of the corporation or any
Subsidiary which is  directly  or  indirectly  owned  by  any
Interested  Shareholder  or any Affiliate or Associate of any
Interested Shareholder;
shall require (i) the affirmative vote of the holders  of  at
least   80%   of  the  combined  voting  power  of  the  then
outstanding  shares  of  all  classes  and  series   of   the
corporation  entitled  to  vote  generally in the election of
directors (the "Voting Shares"), voting together as a  single
class  (the  "voting  shares") (it being understood that, for
the purposes of this Section 7.85, each  voting  share  shall
have  the  number  of  votes  granted  to  it pursuant to the
corporation's  articles  of  incorporation)  and   (ii)   the
affirmative  vote  of a majority of the combined voting power
of the then outstanding voting shares held  by  disinterested
shareholders voting together as a single class.
    (2)  Definition  of  "Business  Combination."   The  term
"business  combination"  as  used  in this Section 7.85 shall
mean any transaction which is referred to in any one or  more
of  clauses  (a)  through  (e)  of  subparagraph  (1) of this
paragraph A.
    C B.  When higher vote is not required.   The  provisions
of  subparagraph  (1)  of  paragraph B A of this Section 7.85
shall  not  be  applicable   to   any   particular   business
combination, and such business combination shall require only
such  affirmative  vote  as  is required by law and any other
provision of the corporation's article of  incorporation  and
any resolutions of the board of directors adopted pursuant to
Section  6.10 if all of the conditions specified in either of
the following subparagraphs (1) and (2) of this paragraph C B
are met:
         (1)  Approval  by  disinterested   directors.    The
    business   combination   shall   have  been  approved  by
    two-thirds of the disinterested directors (as hereinafter
    defined).
         (2)  Price and procedure requirements.  All  of  the
    following conditions shall have been met:
              (a)  The business combination shall provide for
         consideration  to  be  received  by  all  holders of
         common shares in exchange for all their shares,  and
         the aggregate amount of the cash and the fair market
         value as of the date of consummation of the business
         combination  of  consideration other than cash to be
         received per share by holders of  common  shares  in
         such  business  combination shall be at least  equal
         to the higher of the following:
                   (i)  (1) (if applicable) the  highest  per
              share    price    (including    any   brokerage
              commissions,  transfer  taxes  and   soliciting
              dealers'   fees)   paid   by   the   interested
              shareholder  or  any  affiliate or associate of
              the  interested  shareholder  to  acquire   any
              common   shares   beneficially   owned  by  the
              interested shareholder which were acquired  (a)
              within the two year period immediately prior to
              the  first  public announcement of the proposal
              of the business combination (the  "announcement
              date")  or  (b)  in the transaction in which it
              became an interested shareholder, whichever  is
              higher; and
                   (ii)  the  fair  market  value  per common
              share on  the  first  trading  date  after  the
              announcement  date or on the first trading date
              after the date of the first public announcement
              that  the  interested  shareholder  became   an
              interested   shareholder   (the  "Determination
              Date"), whichever is higher.
              (b)  The business combination shall provide for
         consideration to  be  received  by  all  holders  of
         outstanding  shares  other  than  common  shares  in
         exchange  for  all  such  shares,  and the aggregate
         amount of the cash and the fair market value  as  of
         the   date  of  the  consummation  of  the  business
         combination of consideration other than cash  to  be
         received  per share by holders of outstanding shares
         other than common shares shall be at least equal  to
         the highest of the following (it being intended that
         the  requirements  of this subparagraph (2)(b) shall
         be required to be met with respect  to  every  class
         and  series  of outstanding shares other than common
         shares whether or not the interested shareholder  or
         any   affiliate   or  associate  of  the  interested
         shareholder has previously acquired any shares of  a
         particular class or series):
                   (i)  (1)  (if  applicable) the highest per
              share   price    (including    any    brokerage
              commissions,   transfer  taxes  and  soliciting
              dealers'   fees)   paid   by   the   interested
              shareholder or any affiliate  or  associate  of
              the   interested  shareholder  to  acquire  any
              shares of such  class  or  series  beneficially
              owned  by the interested shareholder which were
              acquired   (a)   within   the   2-year   period
              immediately prior to the announcement  date  or
              (b)  in  the  transaction in which it became an
              interested shareholder, whichever is higher;
                   (ii)  (2)  (if  applicable)  the   highest
              preferential  amount  per  share  to  which the
              holders of shares of such class or  series  are
              entitled  in  the  event  of  any  voluntary or
              involuntary liquidation, dissolution or winding
              up of the corporation;
                   (iii) (3)  the fair market value per share
              of such class or series on  the  first  trading
              date  after  the  announcement  date  or on the
              determination date, whichever is higher; and
                   (iv) (4)  an  amount  equal  to  the  fair
              market  value per share of such class or series
              determined pursuant to clause (iii)  (3)  times
              the  highest  value obtained in calculating the
              following quotient for each class or series  of
              which  the  interested shareholder has acquired
              shares within the 2-year period ending  on  the
              announcement  date:  (x)  the highest per share
              price  (including  any  brokerage  commissions,
              transfer taxes and  soliciting  dealers'  fees)
              paid  by  the  interested  shareholder  or  any
              affiliate    or  associate  of  the  interested
              Shareholder for any shares  of  such  class  or
              series   acquired  within  such  2-year  period
              divided by (y) the market value  per  share  of
              such  class  or series on the first day in such
              2-year   period   on   which   the   interested
              shareholder or any affiliate  or  associate  of
              the  interested shareholder acquired any shares
              of such class or series.
         (c)  The consideration to be received by holders  of
    a  particular class or series of outstanding shares shall
    be in  cash  or  in  the  same  form  as  the  interested
    shareholder   or   any  affiliate  or  associate  of  the
    interested shareholder has  previously  paid  to  acquire
    shares  of such class or series beneficially owned by the
    interested shareholder.  If  the  interested  shareholder
    and  any  affiliates  or  associates  of  the  interested
    shareholder  have  paid for shares of any class or series
    with  varying  forms  of  consideration,  the   form   of
    consideration  for  such  class or series shall be either
    cash or the form used to acquire the  largest  number  of
    shares  of such class or series beneficially owned by the
    interested shareholder.
         (d)  After such interested shareholder has become an
    interested shareholder and prior to the  consummation  of
    such  business  combination:    (1) except as approved by
    two-thirds of the disinterested  directors,  there  shall
    have  been  no  failure to declare and pay at the regular
    date therefor any full periodic dividends (whether or not
    cumulative) on any outstanding shares of the  corporation
    other  than  the common shares; (2) there shall have been
    (a) no reduction in the annual rate of dividends paid  on
    the  common  shares  (except  as necessary to reflect any
    subdivision of the common shares), except as approved  by
    two-thirds  of  the  disinterested  directors, and (b) an
    increase in such annual rate of dividends  (as  necessary
    to  prevent  any  such  reduction)  in  the  event of any
    reclassification (including  any  reverse  share  split),
    recapitalization,    reorganization    or   any   similar
    transaction which has the effect of reducing  the  number
    of  outstanding  common  shares;  and (3) such interested
    shareholder shall not have become the beneficial owner of
    any additional  Voting  Shares  except  as  part  of  the
    transaction  which results in such interested shareholder
    becoming an interested shareholder  or  as  a  result  of
    action  taken  by the corporation not caused, directly or
    indirectly, by such interested shareholder.
         (e)  After such interested shareholder has become an
    interested shareholder, such interested shareholder shall
    not have received the  benefit,  directly  or  indirectly
    (except  proportionately as a shareholder), of any loans,
    advances,  guarantees,   pledges   or   other   financial
    assistance  or  any  tax  credits or other tax advantages
    provided by the corporation or any Subsidiary, whether in
    anticipation of  or  in  connection  with  such  business
    combination or otherwise.
         (f)  A proxy or information statement describing the
    proposed  business  combination  and  complying  with the
    requirements of the Securities Exchange Act of  1934  and
    the  rules  and regulations thereunder (or any subsequent
    provisions replacing  such  Act,  rules  or  regulations)
    shall be mailed to public shareholders of the corporation
    at  least  30  days  prior  to  the  consummation of such
    business  combination  (whether  or  not  such  proxy  or
    information statement is required to be  mailed  pursuant
    to such Act or subsequent provisions).
    D.  C.  Certain  definitions.  For  the  purposes of this
Section 7.85:
         (1)  A "Person" means an shall mean any  individual,
    firm, corporation, partnership, trust or other entity.
         (2)  "Interested  shareholder"  means   (i)  a shall
    mean any person (other than the corporation and a  direct
    or indirect majority-owned subsidiary of the corporation)
    that  (a)  is the owner of 15% or more of the outstanding
    voting shares of the corporation or (b) is  an  affiliate
    or  associate of the corporation and was the owner of 15%
    or  more  of  the  outstanding  voting  shares   of   the
    corporation   at  any  time  within  the  3  year  period
    immediately before the date on which it is sought  to  be
    determined   whether   the   person   is   an  interested
    shareholder and (ii) the  affiliates  and  associates  of
    that person, provided, however, that the term "interested
    shareholder" shall not include (x) a person who (A) owned
    shares  in  excess of the 15% limitation as of January 1,
    1997 and either (I) continued to own shares in excess  of
    the  15%  limitation  or would have but for action by the
    corporation or (II) is an affiliate or associate  of  the
    corporation  and so continued (or so would have continued
    but for action by the corporation) to be the owner of 15%
    or  more  of  the  outstanding  voting  shares   of   the
    corporation   at   any  time  within  the  3-year  period
    immediately prior to the date on which it is sought to be
    determined  whether  such  a  person  is  an   interested
    shareholder  or  (B)  acquired  the  shares from a person
    described in clause (A)  by gift, inheritance,  or  in  a
    transaction  in  which  no consideration was exchanged or
    (y) a person whose ownership of shares in excess  of  the
    15%  limitation  is  the result of action taken solely by
    the corporation, provided that the  person  shall  be  an
    interested  shareholder if thereafter the person acquires
    additional shares of the corporation, except as a  result
    of  further  corporate  action  not  caused,  directly or
    indirectly, by the  person  or  if  the  person  acquires
    additional  shares  in transactions approved by the board
    of directors, which approval shall include a majority  of
    the   disinterested   directors.    For  the  purpose  of
    determining   whether   a   person   is   an   interested
    shareholder, the voting shares of the corporation  deemed
    to be outstanding shall include shares deemed to be owned
    by  the person through application of subparagraph (3) of
    this paragraph, but shall not include any other  unissued
    shares  of  the  corporation  that may be issuable or any
    Subsidiary) who or which:
         (a)  is   the   beneficial   owner,   directly    or
    indirectly, of Voting Shares conveying 10% or more of the
    combined  voting  power of the outstanding Voting Shares;
    or
         (b)  is an Affiliate or Associate of the corporation
    and at any time  within  the  2-year  period  immediately
    prior  to  the date in question was the beneficial owner,
    directly or indirectly, of Voting Shares conveying 10% or
    more of the combined voting power of the then outstanding
    Voting Shares.
         (3)  A person shall be a "beneficial owner"  of  any
    Voting Shares:
         (a)  which  such  person or any of its Affiliates or
    Associates beneficially owns, directly or indirectly;
         (b)  which such person or any of its  Affiliates  or
    Associates  has  (1)  the  right to acquire (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 (2) the right to vote or direct  the  vote
    pursuant  to any agreement, arrangement or understanding;
    or
         (3)  "Owner", including the terms "own" and "owned",
    when used with respect to  shares  means  a  person  that
    individually   or   with   or   through   (c)  which  are
    beneficially owned, directly or indirectly, by any  other
    person  which  such  person  or  any of its affiliates or
    associates:   has   any   agreement,    arrangement    or
    understanding  for  the  purpose  of  acquiring, holding,
    voting or disposing of any Voting Shares.
         (4)  For  the  purposes  of  determining  whether  a
    person  is  an   interested   shareholder   pursuant   to
    subparagraph  (2)  of  this  paragraph  C,  the number of
    Voting Shares deemed  to  be  outstanding  shall  include
    shares deemed owned by such person through application of
    subparagraph  (3)  of  this  paragraph  C  but  shall not
    include any other Voting Shares which may be issuable  to
    other persons
              (a)  beneficially  owns the shares, directly or
         indirectly; or
              (b)  has (i) the right to  acquire  the  shares
         (whether  the  right  is  exercisable immediately or
         only after the passage  of  time)  pursuant  to  any
         agreement,  arrangement,  or  understanding, or upon
         exercise  of  conversion  rights,  exchange  rights,
         warrants,  or  options,  or   otherwise;   provided,
         however, that a person shall not be deemed the owner
         of  shares tendered pursuant to a tender or exchange
         offer made by the person  or  any  of  the  person's
         affiliates  or  associates until the tendered shares
         are accepted for purchase or exchange  or  (ii)  the
         right  to  vote the shares pursuant to an agreement,
         arrangement, or  understanding;  provided,  however,
         that  a  person shall not be deemed the owner of any
         shares because of the person's  right  to  vote  the
         shares    if    the   agreement,   arrangement,   or
         understanding to vote the shares arises solely  from
         a  revocable proxy or consent given in response to a
         proxy or consent solicitation made  to  10  or  more
         persons; or
              (c)  has    an   agreement,   arrangement,   or
         understanding for the purpose of acquiring, holding,
         voting (except voting pursuant to a revocable  proxy
         or  consent  as described in clause (ii) of item (b)
         of this subparagraph), or disposing  of  the  shares
         with  any  other  person  that beneficially owns, or
         whose affiliates  or  associates  beneficially  own,
         directly or indirectly, the shares.
         (4)  "Affiliate"  means  a  person that directly, or
    indirectly through one or more intermediaries,  controls,
    is  controlled  by,  or  is  under  common  control with,
    another person.
         (5)  "Associate",   when   used   to   indicate    a
    relationship  with  a  person,  means  (i) a corporation,
    partnership, unincorporated association, or other  entity
    of which the person is a director, officer, or partner or
    is, directly or indirectly, the owner of 20% or more of a
    class  of  voting shares, (ii) a trust or other estate in
    which the person has at least a 20%  beneficial  interest
    or  as  to  which  the  person  serves as trustee or in a
    similar fiduciary  capacity,  and  (iii)  a  relative  or
    spouse  of  the  person, or a relative of that spouse who
    has the same residence as the person.
         (5)  "Affiliate"  and  "Associate"  shall  have  the
    respective meanings ascribed to such terms in Rule  12b-2
    of the General Rules and Regulations under the Securities
    Exchange  Act  of  1934, as amended from time to time, or
    any successor provision (or the respective meanings  last
    ascribed  thereto  if  there  are no amended or successor
    provisions).
         (6)  "Subsidiary" means any corporation of  which  a
    majority  of  any  class  of  equity  security  is owned,
    directly or indirectly,  by  the  corporation;  provided,
    however,  that  for  the  purposes  of  the definition of
    interested shareholder set forth in subparagraph  (2)  of
    this paragraph D C, the term "subsidiary" shall mean only
    a corporation of which a majority of each class or equity
    security   is  owned,  directly  or  indirectly,  by  the
    corporation.
         (7)  "Disinterested director" means  any  member  of
    the  board  of  directors of the corporation who:  (a) is
    neither the interested shareholder nor  an  affiliate  or
    associate of the interested shareholder; (b) was a member
    of  the  board  of  directors  prior to the time that the
    interested shareholder became an  interested  shareholder
    or  was  a  director of the corporation before January 1,
    1997, or  was  recommended  to  succeed  a  disinterested
    director  by  a  majority  of the disinterested directors
    then in office; and (c) was not nominated for election as
    a director by the interested shareholder or any affiliate
    or associate of the interested shareholder.
         (8)  "Fair market value" means:  (a) in the case  of
    shares,  the highest closing sale price during the 30-day
    period immediately preceding the date in  question  of  a
    share  on the New York Stock Exchange Composite Tape, or,
    if such shares are not quoted on the Composite  Tape,  on
    the  New  York Stock Exchange, or, if such shares are not
    listed on such Exchange, on the principal  United  States
    securities   exchange  registered  under  the  Securities
    Exchange Act of 1934 on which such shares are listed, or,
    if such shares are not listed on any such  exchange,  the
    highest  closing sale price or bid quotation with respect
    to a share during the 30-day 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 as
    determined by a majority of the  disinterested  directors
    in good faith; and (b) in the case of property other than
    cash or shares, the fair market value of such property on
    the  date  in question as determined by a majority of the
    disinterested directors in good faith.
         (9)  "Disinterested  shareholder"   shall   mean   a
    shareholder  of  the corporation who is not an interested
    shareholder  or  an  affiliate  or  an  associate  of  an
    interested shareholder.
         (10)  "Business combination"  has  the  meaning  set
    forth  in  Section  11.75  of this Act (regardless of the
    case of the word "only" in that Section).
         (11) (10)  In the event of any business  combination
    in  which  the  corporation  survives,  the phrase "other
    consideration other than cash to be received" as used  in
    subparagraphs  (2)(a) and (2)(b) of paragraph C B of this
    Section 7.85 shall include  the  common  shares  and  the
    shares  of  any  other  class  or  series retained by the
    holders of such shares.
         (12)  "Shares"   means,   with   respect   to    any
corporation,  capital  stock  and,  with respect to any other
entity, any equity interest.
         (13)  "Voting shares" means,  with  respect  to  any
    corporation,  shares  of  any class or series entitled to
    vote generally in the election  of  directors  and,  with
    respect  to  any  entity  that  is not a corporation, any
    equity  interest  entitled  to  vote  generally  in   its
    election of the governing body of the entity.
    E.  (11)  Determinations  by  disinterested directors.  A
majority of the disinterested directors shall have the  power
to  determine,  for  the  purposes  of this Section 7.85, (a)
whether a person is an interested shareholder, (b) the number
of voting  shares  beneficially  owned  by  any  person,  (c)
whether a person is an affiliate or associate of another, and
(d)  whether  the  transaction is the subject of any business
combination. assets which are the  subject  of  any  Business
Combination  have an aggregate fair market value equal to 10%
or more of the corporation's consolidated net worth as of its
then most recent fiscal year end.
    D.  No Effect  on  Fiduciary  Obligations  of  interested
shareholder.  Nothing contained in this Section 7.85 shall be
construed to relieve  any  interested  shareholder  from  any
fiduciary obligation imposed by law.
(Source: P.A. 84-204.)
    (805 ILCS 5/11.75) (from Ch. 32, par. 11.75)
    Sec.   11.75.    Business  combinations  with  interested
shareholders. (a) Notwithstanding  any  other  provisions  of
this  Act,  a  corporation (as defined in this Section 11.75)
shall  not  engage  in  any  business  combination  with  any
interested shareholder for a period of 3 years following  the
time   date   that  such  shareholder  became  an  interested
shareholder, unless (1) prior to such time date the board  of
directors  of  the  corporation  approved either the business
combination  or  the  transaction  which  resulted   in   the
shareholder  becoming  an interested shareholder, or (2) upon
consummation  of  the  transaction  which  resulted  in   the
shareholder   becoming   an   interested   shareholder,   the
interested  shareholder  owned  at  least  85%  of the voting
shares  of  the  corporation  outstanding  at  the  time  the
transaction commenced, excluding for purposes of  determining
the  number  of  shares outstanding those shares owned (i) by
persons who are directors and also officers and (ii) employee
stock plans in which employee participants do  not  have  the
right to determine confidentially whether shares held subject
to  the  plan will be tendered in a tender or exchange offer,
or (3) at on or subsequent to such  time  date  the  business
combination  is  approved  by  the  board  of  directors  and
authorized  at  an annual or special meeting of shareholders,
and not by written consent, by the  affirmative  vote  of  at
least  66 2/3% of the outstanding voting shares which are not
owned by the interested shareholder.
    (b)  The restrictions contained in this Section shall not
apply if:
         (1)  the   corporation's   original   articles    of
    incorporation contains a provision expressly electing not
    to be governed by this Section;
         (2)  the  corporation,  by  action  of  its board of
    directors, adopts an amendment to its by-laws  within  90
    days  of  the  effective  date  of this amendatory Act of
    1989, expressly electing  not  to  be  governed  by  this
    Section,  which amendment shall not be further amended by
    the board of directors;
         (3)  the corporation, by action of its shareholders,
    adopts an amendment to its articles of  incorporation  or
    by-laws  expressly  electing  not  to be governed by this
    Section, provided that, in addition  to  any  other  vote
    required  by  law,  such  amendment  to  the  articles of
    incorporation  or  by-laws  must  be  approved   by   the
    affirmative  vote of a majority of the shares entitled to
    vote. An amendment adopted  pursuant  to  this  paragraph
    shall   be   effective  immediately  in  the  case  of  a
    corporation that both (i) has never had a class of voting
    shares that falls within any of the categories set out in
    paragraph (4) of this subsection (b)  and  (ii)  has  not
    elected  by  a  provision  in  its  original  articles of
    incorporation or any amendment thereto to be governed  by
    this  Section.   In all other cases, an amendment adopted
    pursuant to this paragraph shall not be  effective  until
    12  months after the adoption of such amendment and shall
    not  apply  to  any  business  combination  between  such
    corporation and  any  person  who  became  an  interested
    shareholder  of  such  corporation  on  or  prior to such
    adoption. A by-law amendment  adopted  pursuant  to  this
    paragraph  shall  not  be further amended by the board of
    directors;
         (4)  the he corporation does not  have  a  class  of
    voting shares that is (i) listed on a national securities
    exchange,  (ii)  authorized  for  quotation on the NASDAQ
    Stock  Market  an  inter-dealer  quotation  system  of  a
    registered national securities association or (iii)  held
    of  record by more than 2,000 shareholders, unless any of
    the foregoing results  from  action  taken,  directly  or
    indirectly,  by  an  interested  shareholder  or  from  a
    transaction  in  which  a  person  becomes  an interested
    shareholder;
         (5)  a shareholder becomes an interested shareholder
    inadvertently and (i)  as  soon  as  practicable  divests
    itself  of  ownership  of  sufficient  shares so that the
    shareholder ceases to be an  interested  shareholder  and
    (ii)  would  not,  at  any  time within the 3 year period
    immediately prior to a business combination  between  the
    corporation and such shareholder, have been an interested
    shareholder   but  for  the  inadvertent  acquisition  of
    ownership; or
         (6)  the business combination is proposed  prior  to
    the  consummation or abandonment of and subsequent to the
    earlier of the public announcement or the notice required
    hereunder of a proposed transaction which (i) constitutes
    one of the transactions described in the second  sentence
    of this paragraph; (ii) is with or by a person who either
    was  not  an interested shareholder during the previous 3
    years or who became an interested  shareholder  with  the
    approval  of  the  corporation's  board  of  directors or
    during the period described  in  paragraph  (7)  of  this
    subsection (b); and (iii) is approved or not opposed by a
    majority of the members of the board of directors then in
    office  (but not less than 1) who were directors prior to
    any person becoming an interested shareholder during  the
    previous  3  years  or  were  recommended for election or
    elected to succeed such directors by a majority  of  such
    directors.   The proposed transactions referred to in the
    preceding  sentence  are  limited  to  (x)  a  merger  or
    consolidation of the corporation (except for a merger  in
    respect  of  which, pursuant to subsection (c) of Section
    11.20 of this Act, no vote of  the  shareholders  of  the
    corporation  is  required);  (y) a sale, lease, exchange,
    mortgage, pledge, transfer or other disposition  (in  one
    transaction or a series of transactions), whether as part
    of   a   dissolution  or  otherwise,  of  assets  of  the
    corporation or of any direct or  indirect  majority-owned
    subsidiary  of  the corporation (other than to any direct
    or   indirect   wholly-owned   subsidiary   or   to   the
    corporation) having an aggregate market  value  equal  to
    50%  or  more of either the aggregate market value of all
    of  the  assets  of  the  corporation  determined  on   a
    consolidated  basis  or the aggregate market value of all
    the outstanding shares  of  the  corporation;  or  (z)  a
    proposed  tender or exchange offer for 50% or more of the
    outstanding  voting  shares  of  the  corporation.    The
    corporation  shall  give  not less than 20 days notice to
    all interested shareholders prior to the consummation  of
    any  of  the transactions described in clauses (x) or (y)
    of the second sentence of this paragraph; or
         (7)  The business combination is with an  interested
    shareholder  who  became  an  interested shareholder at a
    time when the restrictions contained in this Section  did
    not  apply by reason of any of the paragraphs (1) through
    (4) of this subsection (b), provided, however, that  this
    paragraph  (7)  shall  not  apply  if,  at  the  time the
    interested shareholder became an interested  shareholder,
    the  corporation's  articles of incorporation contained a
    provision  authorized  by  the  last  sentence  of   this
    subsection (b).  Notwithstanding paragraphs (1), (2), (3)
    and  (4)  of  this  subsection  and  subparagraph  (A) of
    paragraph (5) of subsection (c), any domestic corporation
    may elect by a provision  of  its  original  articles  of
    incorporation  or any amendment thereto to be governed by
    this Section, provided that any  such  amendment  to  the
    articles  of  incorporation shall not apply to restrict a
    business  combination  between  the  corporation  and  an
    interested  shareholder  of  the   corporation   if   the
    interested shareholder became such prior to the effective
    date of the amendment.
    (c)  As used in this Section 11.75 only, the term:
         (1)  "Affiliate"  means  a  person that directly, or
    indirectly through one or more intermediaries,  controls,
    or  is  controlled  by,  or is under common control with,
    another person.
         (2)  "Associate"   when   used   to    indicate    a
    relationship  with any person, means (i) any corporation,
    partnership, unincorporated association, or other  entity
    or  organization  of  which  such  person  is a director,
    officer or partner or is,  directly  or  indirectly,  the
    owner  of 20% or more of any class of voting shares, (ii)
    any trust or other estate in which  such  person  has  at
    least  a  20%  beneficial  interest  or  as to which such
    person serves  as  trustee  or  in  a  similar  fiduciary
    capacity,  and  (iii)  any  relative  or  spouse  of such
    person, or any relative of such spouse, who has the  same
    residence as such person.
         (3)  "Business  combination"  when used in reference
    to any corporation and any interested shareholder of such
    corporation, means:
              (A)  any  merger  or   consolidation   of   the
         corporation or any direct or indirect majority-owned
         subsidiary   of   the   corporation   with  (i)  the
         interested  shareholder,  or  (ii)  with  any  other
         corporation if the merger or consolidation is caused
         by the interested shareholder and  as  a  result  of
         such  merger or consolidation subsection (a) of this
         Section  is  not   applicable   to   the   surviving
         corporation;
              (B)  any   sale,   lease,  exchange,  mortgage,
         pledge,  transfer  or  other  disposition  (in   one
         transaction  or  a  series  of transactions), except
         proportionately   as   a   shareholder    of    such
         corporation,  to or with the interested shareholder,
         whether as part of a dissolution  or  otherwise,  of
         assets  of  the  corporation  or  of  any  direct or
         indirect   majority-owned    subsidiary    of    the
         corporation  which  assets  have an aggregate market
         value equal to 10% or more of either  the  aggregate
         market  value  of  all the assets of the corporation
         determined on a consolidated basis or the  aggregate
         market  value  of  all the outstanding shares of the
         corporation;
              (C)  any  transaction  which  results  in   the
         issuance  or  transfer  by the corporation or by any
         direct or indirect majority-owned subsidiary of  the
         corporation  of  any shares of the corporation or of
         such  subsidiary  to  the  interested   shareholder,
         except  (i)  pursuant  to  the exercise, exchange or
         conversion   of    securities    exercisable    for,
         exchangeable  for or convertible into shares of such
         corporation or any such subsidiary which  securities
         were   outstanding   prior  to  the  time  that  the
         interested shareholder became such, (ii) pursuant to
         a dividend or distribution  paid  or  made,  or  the
         exercise,   exchange  or  conversion  of  securities
         exercisable for,  exchangeable  for  or  convertible
         into   shares   of  such  corporation  or  any  such
         subsidiary which security is distributed,  pro  rata
         to  all  holders  of  a class or series of shares of
         such  corporation  subsequent  to   the   time   the
         interested  shareholder  became such, (iii) pursuant
         to an exchange offer by the corporation to  purchase
         shares made on the same terms to all holders of said
         shares,  or (iv)  any issuance or transfer of shares
         by the corporation, provided  however,  that  in  no
         case  under clauses (ii), (iii) and (iv) above shall
         there be an increase in the interested shareholder's
         proportionate share of the shares of  any  class  or
         series of the corporation or of the voting shares of
         the corporation;
              (D)  any  transaction involving the corporation
         or any direct or indirect majority-owned  subsidiary
         of the corporation which has the effect, directly or
         indirectly, of increasing the proportionate share of
         the  shares  of  any  class or series, or securities
         convertible into the shares of any class or  series,
         of  the  corporation or of any such subsidiary which
         is owned by the interested shareholder, except as  a
         result of immaterial changes due to fractional share
         adjustments  or  as  a  result  of  any  purchase or
         redemption of any shares of any class or series  not
         caused,  directly  or  indirectly, by the interested
         shareholder; or
              (E)  any receipt by the interested  shareholder
         of  the  benefit,  directly  or  indirectly  (except
         proportionately    as    a   shareholder   of   such
         corporation) of  any  loans,  advances,  guarantees,
         pledges,  or  other  financial  benefits (other than
         those  expressly  permitted  in  subparagraphs   (A)
         through  (D)  of  this paragraph (3)) provided by or
         through the corporation or any  direct  or  indirect
         majority owned subsidiary; or
              (F)  any  receipt by the interested shareholder
         of the  benefit,  directly  or  indirectly,  (except
         proportionately    as    a   shareholder   of   such
         corporation)  of  any   assets,   loans,   advances,
         guarantees,  pledges  or  other  financial  benefits
         (other    than    those   expressly   permitted   in
         subparagraphs (A) through (D) of this paragraph (3))
         provided by or through any "defined benefit  pension
         plan"  (as  defined  in  Section  3  of the Employee
         Retirement Income Security Act) of  the  corporation
         or any direct or indirect majority owned subsidiary.
         (4)  "Control",  including  the  term "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 shares, by contract or otherwise.  A person who is
    the  owner  of  20%  or  more  of  the  a   corporation's
    outstanding    voting    shares   of   any   corporation,
    partnership, unincorporated association, or other  entity
    shall   be  presumed  to  have  control  of  such  entity
    corporation, in the absence of proof by preponderance  of
    the   evidence  to  the  contrary.   Notwithstanding  the
    foregoing, a presumption of control shall not apply where
    such person holds voting shares, in good  faith  and  not
    for  the  purpose  of  circumventing  this Section, as an
    agent, bank, broker, nominee, custodian  or  trustee  for
    one  or more owners who do not individually or as a group
    have control of such entity corporation.
         (5)  "Corporation"  means  a  domestic   corporation
    that:
              (A)  has any equity securities registered under
         Section 12 of the Securities Exchange Act of 1934 or
         is subject to Section 15(d) of that Act; and
              (B)  either
                   (i)  has  its  principal place of business
              or its principal executive  office  located  in
              Illinois; or
                   (ii)  owns   or  controls  assets  located
              within Illinois that have a fair  market  value
              of at least $1,000,000, and
              (C)  either
                   (i)  has more than 10% of its shareholders
              resident in Illinois;
                   (ii)  has  more  than  10%  of  its shares
              owned by Illinois residents; or
                   (iii)  has 2,000 shareholders resident  in
              Illinois.
         The residence of a shareholder is presumed to be the
    address  appearing  in  the  records  of the corporation.
    Shares held by banks  (except  as  trustee,  executor  or
    guardian), securities dealers or nominees are disregarded
    for  purposes  of calculating the percentages and numbers
    in this paragraph (5).
         (6)  "Interested  shareholder"  means   any   person
    (other  than  the  corporation and any direct or indirect
    majority-owned subsidiary of the corporation) that (i) is
    the owner of 15% or more of the outstanding voting shares
    of the corporation, or (ii) is an affiliate or  associate
    of  the  corporation  and was the owner of 15% or more of
    the outstanding voting shares of the corporation  at  any
    time  within  the  3 year period immediately prior to the
    date on which it is sought to be determined whether  such
    person  is  an interested shareholder; and the affiliates
    and associates of such person,  provided,  however,  that
    the  term  "interested shareholder" shall not include (x)
    any person who (A) owned shares  in  excess  of  the  15%
    limitation  set  forth  herein  as  of,  or acquired such
    shares pursuant to a tender offer commenced prior to  the
    effective date of this amendatory Act of 1989 or pursuant
    to  an  exchange  offer  announced prior to the aforesaid
    date and commenced within 90 days thereafter  and  either
    (I)  and  continued  to  own shares in excess of such 15%
    limitation  or  would  have  but  for   action   by   the
    corporation  or  (II) is an affiliate or associate of the
    corporation and so continued (or so would have  continued
    but for action by the corporation) to be the owner of 15%
    or   more   of  the  outstanding  voting  shares  of  the
    corporation  at  any  time  within  the   3-year   period
    immediately prior to the date on which it is sought to be
    determined   whether  such  a  person  is  an  interested
    shareholder or (B) acquired said  shares  from  a  person
    described  in  (A)  above  by  gift,  inheritance or in a
    transaction in which no consideration was  exchanged;  or
    (y) any person whose ownership of shares in excess of the
    15%  limitation  set forth herein is the result of action
    taken solely  by  the  corporation,  provided  that  such
    person  shall  be an interested shareholder if thereafter
    such person acquires additional shares of  voting  shares
    of  the  corporation,  except  as  a  result  of  further
    corporate  action  not caused, directly or indirectly, by
    such person.  For the purpose of  determining  whether  a
    person is an interested shareholder, the voting shares of
    the  corporation  deemed  to be outstanding shall include
    shares  deemed  to  be  owned  by  the   person   through
    application  of  paragraph  (8)  of  this subsection, but
    shall not include  any  other  unissued  shares  of  such
    corporation   which  may  be  issuable  pursuant  to  any
    agreement, arrangement or understanding, or upon exercise
    of conversion rights, warrants or options, or otherwise.
         (7)  "Person"  means  any  individual,  corporation,
    partnership, unincorporated association or other entity.
         (7.5)  "Shares"   means,   with   respect   to   any
    corporation, capital stock and, with respect to any other
    entity, any equity interest.
         (8)  "Voting shares"  means,  with  respect  to  any
    corporation,  shares  of  any class or series entitled to
    vote generally in the election  of  directors  and,  with
    respect  to  any  entity  that  is not a corporation, any
    equity  interest  entitled  to  vote  generally  in   its
    election of the governing body of the entity.
         (9)  "Owner"  including  the terms "own" and "owned"
    when used with respect to any shares means a person  that
    individually  or with or through any of its affiliates or
    associates:
              (A)  beneficially owns such shares, directly or
         indirectly; or
              (B)  has (i) the right to acquire  such  shares
         (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;  provided,
         however, that a person shall not be deemed the owner
         of shares tendered pursuant to a tender or  exchange
         offer  made  by  such person or any of such person's
         affiliates or associates until such tendered  shares
         is  accepted  for  purchase or exchange; or (ii) the
         right to vote such shares pursuant to any agreement,
         arrangement  or  understanding;  provided,  however,
         that a person shall not be deemed the owner  of  any
         shares  because  of such person's right to vote such
         shares   if   the    agreement,    arrangement    or
         understanding to vote such shares arises solely from
         a  revocable proxy or consent given in response to a
         proxy or consent solicitation made  to  10  or  more
         persons; or
              (C)  has    any   agreement,   arrangement   or
         understanding for the purpose of acquiring, holding,
         voting (except voting pursuant to a revocable  proxy
         or   consent   as   described   in  clause  (ii)  of
         subparagraph (B) of this paragraph), or disposing of
         such shares with any other person that  beneficially
         owns, or whose affiliates or associates beneficially
         own, directly or indirectly, such shares.
    (d)  No  provision  of  a certificate of incorporation or
by-law shall require, for any vote of  shareholders  required
by  this  Section  a  greater  vote of shareholders than that
specified in this Section.
    (e)  The provisions of this Section 11.75  are  severable
and any provision held invalid shall not affect or impair any
of the remaining provisions of this Section.
(Source: P.A. 86-126.)

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