Exhibit 99.2:
MARYLAND CONTROL SHARE ACQUISITION STATUTE
Subtitle 7. Voting Rights of Certain Control Shares.
Section 3-701. Definitions.
(a) In general. -- In this subtitle, the following words have
the meanings indicated.
(b) Acquiring person. -- "Acquiring person" means a person
who makes or proposes to make a control share acquisition.
(c) Associate. -- "Associate", when used to indicate a
relationship with any person, means:
(1) An "associate" as defined in Section 3-601(c) of
this title; or
(2) A person that:
(i) Directly or indirectly controls, or is
controlled by, or is under common control with, the person specified; or
(ii) Is acting or intends to act jointly or
in concert with the person specified.
(d) Control shares. -- (1) "Control shares" means shares of
stock that, except for this subtitle, would, if aggregated with all other
shares of stock of the corporation (including shares of the acquisition of
which is excluded from "control share acquisition" in subsection (e)(2) of
this section) owned by a person or in respect of which that person is
entitled to exercise or direct the exercise of voting power, except solely
by virtue of a revocable proxy, entitle that person, directly or
indirectly, to exercise or direct the exercise of the voting power of
shares of stock of the corporation in the election of directors within any
of the following ranges of voting power:
(i) One-fifth or more, but less than one-third of all
voting power;
(ii) One-third or more, but less than a majority of
all voting power; or
(iii) A majority or more of all voting power.
(2) "Control shares" includes 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
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power set forth in this section for which approval has not been obtained
previously under Section 3-702 of this subtitle.
(e) Control share acquisition. -- (1) "Control share
acquisition" means the acquisition, directly or indirectly, by any person,
of ownership of, or the power to direct the exercise of voting power with
respect to, issued and outstanding control shares.
(2) "Control share acquisition" does not include the
acquisition of shares:
(i) Before November 4, 1988;
(ii) Under a contract made before November 4,
1988;
(iii) Under the laws of descent and
distribution;
(iv) Under the satisfaction of a pledge or
other security interest created in good faith and not for the purpose of
circumventing this subtitle; or
(v) 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.
(3) Unless the acquisition entitles any person,
directly or indirectly, to exercise or direct the exercise of voting power
in the election of directors in excess of the range of voting power
previously authorized or attained under an acquisition that is exempt
under paragraph (2) of this subsection, "control share acquisition" does
not include the acquisition of shares of a corporation in good faith and
not for the purpose of circumventing this subtitle by or from:
(i) Any person whose voting rights have
previously been authorized by stockholders in compliance with this
subtitle; or
(ii) 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.
(f) Interested shares. -- "Interested shares" means shares of
a corporation in respect of which any of the following persons is entitled
to exercise or direct the exercise of the voting power of shares of stock
of the corporation in the election of directors:
(1) An acquiring person;
(2) An officer of the corporation; or
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(3) An employee of the corporation who is also a
director of the corporation
(g) Corporation. -- "Corporation" includes a real estate
investment trust, as defined in Title 8 of this article.
(h) Person. -- "Person" includes an associate of the person.
(1989, ch. 51.)
Section 3-702. Voting Rights.
(a) Approval by stockholders. -- (1) Control shares of the
corporation acquired in a control share acquisition have no voting rights
except to the extent approved by the stockholders at a meeting held under
3-704 of this subtitle by the affirmative vote of two-thirds of all the
votes entitled to be cast on the matter, excluding all interested shares.
(2) A charter provision permitted by 2-104 (b) (5) of
this article may not apply to the proportion of votes required by
paragraph (1) of this subsection.
(b) Applicability of charter provisions. -- This subtitle
does not apply to the voting rights of shares of stock if the acquisition
of the shares specifically, generally, or generally by types, as to
specifically identified or unidentified existing or future stockholders or
their affiliates or associates, has been approved or exempted by a
provision contained in the charter or bylaws and adopted at any time
before the acquisition of the shares.
(c) Application of subtitle. -- This subtitle does not apply
to:
(1) A close corporation as defined in Section 4-101
(b) of this article;
(2) A corporation having fewer than 100 beneficial
owners of its stock; or
(3) An investment company registered under the
Investment Company Act of 1940.
(d) Beneficial owners. -- For the purposes of subsection (c)
(2) of this section, all stockholders of a corporation that have executed
an agreement to which the corporation is an executing party governing the
purchase and sale of stock of the corporation or a voting trust agreement
governing stock of the corporation shall be considered a single beneficial
owner of the stock covered by the agreement.
(e) Acquisition of shares; voting power. -- For the purposes
of Section 3-701 of this subtitle:
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(1) Shares acquired within 90 days or shares acquired
under a plan to make a control share acquisition are considered to have
been acquired in the same acquisition; and
(2) A person may not be deemed to be entitled to
exercise or direct the exercise of voting power with respect to shares
held for the benefit of others if the person:
(i) Is acting in the ordinary course of
business, in good faith and not for the purpose of circumventing the
provisions of this section; and
(ii) 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. (1989, ch. 51.)
Section 3-703. Acquiring person statement.
Any person who proposes to make or who has made a control share
acquisition may deliver an acquiring person statement to the corporation
at the corporation's principal office. The acquiring person statement
shall set forth all of the following:
(1) The identity of the acquiring person and each other
member of any group of which the person is a part for purposes of
determining control shares;
(2) A statement that the acquiring person statement is given
under this subtitle;
(3) The number of shares of the corporation owned (directly
or indirectly) by the acquiring person and each other member of any group;
(4) The applicable range of voting power as set forth in
Section 3-701 (d) of this subtitle; and
(5) If the control share acquisition has not occurred:
(i) A description in reasonable detail of the terms
of the proposed control share acquisition; and
(ii) Representations of the acquiring person, together
with a statement in reasonable detail of the facts on which they are
based, that:
1. The proposed control share acquisition,
if consummated, will not be contrary to law; and
2. 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 Section 3-705 of
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this subtitle, to make the proposed control share acquisition. (1989, ch.
51.)
Section 3-704. Special meeting.
(a) Request by acquiring person. -- Except as provided in
Section 3-705 of this subtitle, if the acquiring person requests, at the
time of delivery of an acquiring person statement, and gives a written
undertaking to pay the corporation's expenses of a special meeting, except
the expenses of opposing approval of the voting rights, within 10 days
after the day on which the corporation receives both the request and
undertaking, the directors of the corporation shall call a special meeting
of stockholders of the corporation for the purpose of considering the
voting rights to be accorded the shares acquired or to be acquired in the
control share acquisition.
(b) Bond. -- The directors may require the acquiring person
to give bond, with sufficient surety, to reasonably assure the corporation
that this undertaking will be satisfied.
(c) Time for meeting. -- Unless the acquiring person agrees
in writing to another date, the special meeting of stockholders shall be
held within 50 days after the day on which the corporation has received
both the request and the undertaking.
(d) Delay at request of acquiring person. -- If the acquiring
person makes a request in writing at the time of delivery of the acquiring
person statement, the special meeting may not be held sooner than 30 days
after the day on which the corporation receives the acquiring person
statement.
(e) In absence of request. -- (1) If no request is made under
subsection (a) of this section, the issue of the voting rights to be
accorded the shares acquired in the control share acquisition may, at the
option of the corporation, be presented for consideration at any meeting
of stockholders.
(2) If no request is made under subsection (a) of
this section and the corporation proposes to present the issue of the
voting rights to be accorded the shares acquired in a control share
acquisition for consideration at any meeting of stockholders, the
corporation shall provide the acquiring person with written notice of the
proposal not less than 20 days before the date on which notice of the
meeting is given. (1989, ch. 51.)
Section 3-705. Calls.
A call of a special meeting of stockholders of the corporation is
not required to be made under Section 3-704 (a) of this subtitle unless,
at the
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time of delivery of an acquiring person statement under Section 3-703 of
this subtitle, the acquiring person has:
(1) Entered into a definitive financing agreement or
agreements with one or more responsible financial institutions or other
entities that have the necessary financial capacity, providing for any
amount of financing of the control share acquisition not to be provided by
the acquiring person; and
(2) Delivered a copy of the agreements to the corporation.
(1989, ch. 51.)
Section 3-706. Notice of meeting.
(a) In general. -- If a special meeting of stockholders is
requested, notice of the special meeting shall be given as promptly as
reasonably practicable by the corporation to all stockholders of record as
of the record date set for the meeting, whether or not the stockholder is
entitled to vote at the meeting.
(b) Contents. -- Notice of the special or annual meeting of
stockholders at which the voting rights are to be considered shall include
or be accompanied by the following:
(1) A copy of the acquiring person statement
delivered to the corporation under Section 3-703 of this subtitle; and
(2) A statement by the board of directors of the
corporation setting forth the position or recommendation of the board, or
stating that the board is taking no position or making no recommendation,
with respect to the issue of voting rights to be accorded the control
shares. (1989, ch. 51.)
Section 3-707. Redemption rights.
(a) Upon delivery of acquiring person statement. -- Unless
the charter or bylaws provide otherwise, if an acquiring person statement
has been delivered on or before the 10th day after the control share
acquisition, the corporation may, at its option, redeem any or all control
shares, except control shares for which voting rights have been previously
approved under Section 3-702 of this subtitle, at any time during a 60-day
period commencing on the day of a meeting at which voting rights are
considered under Section 3-704 of this subtitle and are not approved.
(b) In absence of delivery of acquiring person statement. --
In addition to the redemption rights authorized under subsection (a) of
this section, unless the charter or bylaws provide otherwise, if an
acquiring person statement has not been delivered on or before the 10th
day after the control share acquisition, the corporation may, at its
option, redeem any or all control shares, except control shares for which
voting rights have been previously approved under Section 3-702 of this
subtitle, at any time during a period commencing on the 11th day after the
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control share acquisition and ending 60 days after a statement has been
delivered.
(c) Fair value. -- Any redemption of control shares under
this section shall be at the fair value of the shares. For purposes of
this section, "Fair value" shall be determined:
(1) As of the date of the last acquisition of control
shares by the acquiring person in a control share acquisition or, if a
meeting is held under Section 3-704 of this subtitle, as of the date of
the meeting; and
(2) Without regard to the absence of voting rights
for the control shares. (1989, ch. 51.)
3-708. Status as objecting stockholders.
(a) In general. -- Unless the charter or bylaws provide
otherwise, before a control share acquisition has occurred, if voting
rights for control shares are approved at a meeting held under Section
3-704 of this subtitle and the acquiring person is entitled to exercise or
direct the exercise of a majority or more of all voting power, all
stockholders of the corporation (other than the acquiring person) have the
rights of objecting stockholders as provided in Subtitle 2 of this title.
(b) Corporation deemed successor. -- For purposes of applying
the provisions of Subtitle 2 of this title to stockholders under this
section, the corporation shall be deemed to be a successor in a merger and
the date of the most recent approval of voting rights referred to in
subsection (a) of this section shall be deemed to be the date of filing of
articles of merger for record with the Department.
(c) Status to be contained in notice. -- The notice required
by Section 3-207 of this title shall also state that stockholders (other
than the acquiring person) are entitled to the rights of objecting
stockholders under Subtitle 2 of this title and shall include a copy of
this section and Subtitle 2 of this title.
(d) Application of Subtitle 2. -- For purposes of applying
the provisions of Subtitle 2 of this title to this section:
(1) "Fair value" may not be less than the highest
price per share paid by the acquiring person in the control share
acquisition; and
(2) Sections 3-202 (c) and 3-203 (a) (1) and (2) of
this title do not apply. (1989, ch. 51.)
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