Document:

Exhibit 10.1

 

PUT OPTION
AGREEMENT

 

This
Put Option Agreement (“Agreement”), dated effective as of February 25, 2020 (the “Effective
Date”), is made by and between Allied Esports Entertainment, Inc., a Delaware corporation (the “Company”),
and Lyle A. Berman (the “Investor”).

 

Whereas,
subject to the terms and conditions set forth in this Agreement, the Company desires to obtain an option to sell to the
Investor, and the Investor is willing to buy from the Company, shares of the common stock, $0.0001 par value, of the Company (“Common
Stock”) for aggregate gross proceeds of up to Two Million Dollars ($2,000,000.00).

 

Now,
Therefore, in consideration of the foregoing facts and premises
hereby made a part of this Agreement, the mutual promises hereinafter set forth and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:

 

1.            
Put Option and Lock-Up.

 

(a)            
Grant. In consideration of $1.00 and the other consideration set forth in the recitals to this Agreement, the sufficiency
and receipt of which is hereby acknowledged, Investor hereby grants to the Company an irrevocable option (the “Option”)
to sell to the Investor (or such designee chosen by Investor) newly issued shares of Common Stock (the “Option Shares”)
for an aggregate Purchase Price (as defined in and calculated pursuant to Section 1(c)) of up to $2,000,000.00. The Company may,
in its discretion, exercise the Option as provided herein at any time commencing on the Effective Date of this Agreement and expiring
at 11:59 p.m. Irvine, California time on April 9, 2020 (such applicable period, the “Option Period”). The Option
Shares are sometimes referred to herein as the “Securities.”

 

(b)             
Exercise; Closing(s). The Company may, in its discretion, exercise the Option by providing written notice
to the Investor (the “Option Notice”) at any time during the Option Period of the Company’s election to
exercise the Option in full but not in part, except as provided in Section 1(d). As promptly as practicable, but in any event within
30 days after receipt of such Option Notice by the Investor (which, for the sake of clarity, may occur after the expiration of
the Option Period), the parties shall consummate the sale transaction by the Company delivering the Option Shares, which shall
be accepted by the Investor (the “Closing”), against the Investor’s payment of the Purchase Price (as
defined below) to the Company by wire transfer of immediately available funds pursuant to instructions delivered by the Company
to the Investor prior to or at the Closing. Notwithstanding the foregoing, the Investor may, upon delivering written notice to
the Company, elect to hold two (2) separate Closings at which the Company will deliver one-half of the Option Shares to the Investor
against the Investor’s payment of one-half of the Purchase Price to the Company. In such circumstance, the second Closing
will be conducted no later than the one-month anniversary of the first Closing.

 

(c)             
Purchase Price. The purchase price per share of Common Stock (the “Purchase Price”) will
be equal to $1.963, which represents seventy-five percent (75%) of the volume-weighted average price (VWAP) of a share of Common
Stock over the ten (10) trading days immediately prior to the date of this Agreement, as
reported on The Nasdaq Stock Market.

 

(d)             
Compliance with Securities Laws and Principal Market Rules. Notwithstanding anything in this Agreement to the contrary:

 

(i)               Exchange
Cap. The total number of shares of Common Stock that may be issued under this Agreement shall be limited to 4,784,580 shares
of Common Stock (the “Exchange Cap”), which equals 19.99% of the Company’s outstanding shares of Common
Stock as of the date hereof (rounded down to the nearest full share), unless Company stockholder approval is obtained to issue
more than such 19.99% in accordance with the rules of The Nasdaq Stock Market. The Exchange Cap shall be appropriately adjusted
for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction.

 

 

 

    	 	1	 

     

    

 

(ii)              Beneficial
Ownership Limitation. The Company shall not issue, and the Investor shall not purchase, any Option Shares if such shares proposed
to be issued and sold, when aggregated with all other shares of Common Stock then owned beneficially (as calculated pursuant to
Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3 promulgated thereunder) by the Investor and its
affiliates would result in the beneficial ownership by the Investor and its affiliates of more than 19.99% of the then issued and
outstanding shares of Common Stock of the Company unless (A) such ownership or voting power would not be the largest ownership
position in the Company, or (B) Company stockholder approval is obtained for such ownership in excess of 19.99% in accordance with
the rules of The Nasdaq Stock Market.

 

(iii)             Equity
Compensation Limitation. The Company shall not issue, and the Investor shall not purchase, any Option Shares if such issuance
and purchase would be considered equity compensation under the rules of The Nasdaq Stock Market unless Company stockholder approval
is obtained for such issuance in accordance with such rules.

 

The Option Shares to be issued by the Company
at Closing, and the Purchase Price to be paid therefor, shall be appropriately reduced in order to comply with the limitations
set forth in this Section 1(d).

 

(e)                  
Lock-Up Agreement. The Investor hereby agrees that, without the prior written consent of the Company, the
Investor will not, during the period commencing on the date of issuance of the Securities, and ending six (6) months after the
date of such issuance, (i) offer, pledge, sell, contract to sell, grant, lend, or otherwise transfer or dispose of, directly or
indirectly, the Securities; (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of
the economic consequences of ownership of the Securities; or (iii) publicly disclose the intention to make any offer, sale, pledge
or disposition, or to enter into any transaction, swap, hedge or other arrangement relating to the Securities.

 

2.            
Investor Representations, Warranties and Covenants. The Investor represents and warrants to and agrees with the
Company as follows:

 

(a)            
The execution and delivery of this Agreement will not conflict with or result in a breach of any terms or constitute a default
under any agreement or undertaking of the Investor. No notice, consent or approval by any person is necessary for the Investor
to enter into or to perform its obligations under this Agreement.

 

(b)             
The Investor’s execution and delivery of this Agreement constitutes the legal, valid and binding agreement of the
Investor, and is enforceable against the Investor in accordance with its terms.

 

(c)             
The Investor is acquiring the Securities as principal for its own account and not with a view to or for distributing or
reselling such Securities or any part thereof in violation of the Securities Act or any applicable state securities law, has no
present intention of distributing any of such Securities in violation of the Securities Act or any applicable state securities
law and has no direct or indirect arrangement or understandings with any other Persons to distribute or regarding the distribution
of such Securities in violation of the Securities Act or any applicable state securities law. The Investor is acquiring the Securities
hereunder in the ordinary course of its business.

 

(d)             
The Investor is an "accredited investor" as that term is defined in Rule 501(a)(3) of Regulation D promulgated
under the Securities Act.

 

(e)             
The Investor understands that the Securities are being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and that the Company is relying in part upon the truth
and accuracy of, and the Investor's compliance with, the representations, warranties, agreements, acknowledgments and understandings
of the Investor set forth herein in order to determine the availability of such exemptions and the eligibility of the Investor
to acquire the Securities.

 

 

 

    	 	2	 

     

    

 

(f)             
The Investor understands that its investment in the Securities involves a high degree of risk. The Investor (i) is able
to bear the economic risk of an investment in the Securities including a total loss thereof, (ii) has such knowledge and experience
in financial and business matters that it is capable of evaluating the merits and risks of the proposed investment in the Securities
and (iii) is familiar with the financial condition and business of the Company given his position as Chairman of the Board of the
Company, and has had an opportunity to ask any questions of and receive answers from the officers of the Company with respect thereto
and others matters related to an investment in the Securities. The Investor has sought such accounting, legal and tax advice as
it has considered necessary to make an informed investment decision with respect to its acquisition of the Securities.

 

(g)            
The Investor understands that (i) the Securities may not be offered for sale, sold, assigned or transferred unless (A) registered
pursuant to the Securities Act or (B) an exemption exists permitting such Securities to be sold, assigned or transferred without
such registration; (ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance with the terms of
Rule 144 and further, if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller (or the
Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require
compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder.

 

3.            
Company Representations, Warranties and Covenants. The Company hereby represents and warrants to and agrees with
the Investor as follows:

 

(a)             
The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not conflict
with or result in a breach of any terms or constitute a default under any agreement or undertaking of the Company. The Company
has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The Company’s
execution and delivery of this Agreement constitutes the legal, valid and binding agreement of the Company, and is enforceable
against the Company in accordance with its terms.

 

(b)             
Upon issuance and payment therefor in accordance with the terms and conditions of this Agreement, the Securities shall be
validly issued, fully paid and nonassessable and free from all taxes, liens, charges, restrictions (other than such restrictions
on transfer arising under the Securities Act and the restrictions under this Agreement), rights of first refusal and preemptive
rights with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock under
the Company’s Certificate of Incorporation, Bylaws and the Delaware General Corporation Law, as amended.

 

4.            
Miscellaneous.

 

(a)             
Notices. Any notices, consents or other communications required or permitted to be given under the terms of this Agreement
must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when
sent by electronic message (provided the recipient responds to the message and confirmation of both electronic messages are kept
on file by the sending party); or (iii) one business day after timely deposit with a nationally recognized overnight delivery service,
in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall
be:

 

If to the Company:

 

Allied Esports Entertainment,
Inc.

17877 Von Karman Avenue, Suite
300

Irvine, California, 92614

Attention: Chief Executive Officer

Email: Frank@alliedesports.com

 

 

 

    	 	3	 

     

    

 

With a copy (which shall not
constitute notice) to:

 

Maslon LLP

90 South 7th Street, Suite 3300

Minneapolis, MN 55402

Attention: Bradley A.
Pederson

Email:
Bradley.Pederson @maslon.com

 

If to the Investor:

 

Lyle Berman

c/o Maslon LLP

90 South Seventh Street, Suite
3300

Minneapolis, MN 55402

Attention: Neil I. Sell

Email:
Neil.Sell@maslon.com and lb@bermancc.com

 

or at such other address and/or to the
attention of such other person as the recipient party has specified by written notice given to each other party at least one business
day prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent
or other communication, (B) electronically generated by the sender’s electronic mail containing the time, date and recipient
email address or (C) provided by a nationally recognized overnight delivery service, shall be rebuttable evidence of receipt in
accordance with clause (i), (ii), or (iii) above, respectively.

 

(b)                 
Governing Law and Venue. This Agreement shall be governed by the laws of the State of California without regard to
its conflicts-of-law principles. The parties expressly acknowledge and agree that any judicial action to enforce any right of any
party under this Agreement may be brought and maintained in the State of California, and the parties consent to the jurisdiction
of the courts of the State of California, County of Orange, and the federal courts located in the Central District of the State
of California. Accordingly, the parties hereby submit to the process, jurisdiction and venue of any such court. Each party hereby
waives, and agrees not to assert, any claim that it is not personally subject to the jurisdiction of the foregoing courts in the
State of California or that any action or other proceeding brought in compliance with this Section is brought in an inconvenient
forum.

 

(c)                 
Specific Performance. The parties agree that irreparable damage would occur in the event that any of the provisions
of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed
that the parties will be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof, this being in addition to any other remedy to which such party is entitled at law or in equity.
Each of the parties agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief
permitted by this Agreement. Any party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in accordance with this Agreement will not be required to provide any bond
or other security in connection with any such order or injunction.

 

(d)                 
Entire Agreement, Successors and Assignment. The recitals are incorporated into this Agreement. This Agreement sets
forth the entire agreement and understanding of the parties with respect to the transactions contemplated hereby and supersedes
all prior agreements, arrangements and understandings relating to the subject matter hereof. All of the terms, representations
and warranties of this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their
respective successors and assigns. Except with respect to designating the recipient of the Securities, Investor may not assign
his rights or delegate his obligations under this Agreement.

 

 

 

    	 	4	 

     

    

 

(e)                 
Further Assurances. Each party to this Agreement will, on or at any time after the Effective Date, execute such further
documents or instruments and take such further actions as may be reasonably requested by any other party to this Agreement to effect
the purposes of this Agreement.

 

(f)                  
Modification or Waiver. Any of the terms or conditions of this Agreement may be waived in writing at any time by
the party that is entitled to the benefits thereof. No waiver of any of the provisions of this Agreement shall be deemed to or
shall constitute a waiver of any other provision hereof. No delay or failure on the part of any party hereto to exercise any right,
power or privilege hereunder shall operate as a waiver thereof; nor shall any waiver on the part of any party hereto of any right,
power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder; nor shall any single or partial
exercise of any right, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder.

 

(g)                 
Severability. If any provision or term of this Agreement is held invalid or unenforceable for any reason, the parties
agree that such invalidity shall not affect the validity of the remaining provisions of this Agreement, and further agree to substitute
for the invalid provision a valid provision which most closely approximates the intent and economic effect of such invalid provision.

 

(h)                 
Notices. All notices or other communications hereunder will be in writing and will be deemed given on (i) the day
given in person, (ii) the next business day if sent by overnight delivery service to the parties at the respective addresses set
forth in the introductory paragraph of this Agreement, or (iii) two business days after the date such notice is deposited into
the U.S. postal mail, first class, postage prepaid, to the parties at the respective addresses set forth in the introductory paragraph
of this Agreement. The addresses of the parties for purposes of notice may be changed by either party by delivering notice of such
address change in compliance with the provisions of this Agreement.

 

(i)                   
Counterparts. This Agreement may be executed in two or more counterparts, each of which will constitute an original,
but all of which, when taken together, will constitute the same agreement.

 

Signature Page Follows

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	5	 

     

    

 

 

In
Witness Whereof, the parties hereto have caused this Agreement to be duly executed as of the date first written above.

 

	 	COMPANY:
	 	 
	 	ALLIED ESPORTS ENTERTAINMENT, INC.
	 	 
	 	By: /s/ Frank Ng
	 	Frank Ng, Chief Executive Officer
	 	 
	 	 
	 	 
	 	INVESTOR:
	 	 
	 	 
	 	/s/ Lyle Berman
	 	Lyle A.
Berman, Individually

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	6adpt-ex43_880.htm

EXHIBIT 4.3

 

DESCRIPTION OF REGISTRANT’S SECURITIES 

REGISTERED PURSUANT TO SECTION 12 

OF THE SECURITIES EXCHANGE ACT OF 1934

The following description (this “Description”) of our common stock is a summary and does not purport to be complete. It is subject to, and qualified in its entirety by reference to, our Articles of Incorporation and Bylaws, each of which have been filed with the Securities and Exchange Commission. This description also summarizes relevant provisions of Washington law. We encourage you to read our Articles of Incorporation, Bylaws and the applicable provisions of Washington law for additional information.

General

Our authorized capital stock consists of 340,000,000 shares of common stock, par value $0.0001 per share, and 10,000,000 shares of preferred stock, par value $0.0001 per share, all of which shares of preferred stock are undesignated.

Our board of directors has the authority, without further action by our shareholders (unless required by Nasdaq rules), to issue up to the authorized amount of shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof. No shares of preferred stock have been issued or are outstanding as of the date of the filing of the Annual Report on Form 10-K of which this Description forms a part, and we have no present plan to issue any shares of preferred stock. 

Common Stock

The holders of our common stock are entitled to one vote for each share held on all matters submitted to a vote of the shareholders. The holders of our common stock do not have any cumulative voting rights. Holders of our common stock are entitled to receive ratably any dividends declared by our board of directors out of funds legally available for that purpose, subject to any preferential dividend rights of any outstanding preferred stock. Our common stock has no preemptive rights, conversion rights or other subscription rights or redemption or sinking fund provisions.  In  the event of our liquidation, dissolution or winding up, holders of our common stock will be entitled to share ratably in all assets remaining after payment of all debts and other liabilities and any liquidation preference of any outstanding preferred stock. Our common stock is listed on The Nasdaq Global Select Market under the symbol “ADPT.”  The transfer agent and registrar for our common stock is Computershare Trust Company, N.A. The transfer agent and registrar’s address is 250 Royall Street, Canton, Massachusetts 02021.

Anti-Takeover Effects of our Articles of Incorporation, Bylaws and Washington Law

Our Articles of Incorporation and Bylaws include a number of provisions that may have the effect of delaying, deferring or preventing another party from acquiring control of us and encouraging persons considering unsolicited tender offers or other unilateral takeover proposals to negotiate with our board of directors rather than pursue non-negotiated takeover attempts. These provisions include the items described below.

Board Composition and Filling Vacancies

Our Articles of Incorporation provide for the division of our board of directors into three classes serving staggered three-year terms, with one class being elected each year. Our Articles of Incorporation also provide that directors may be removed only for cause and then only if the number of votes of the holders of the shares entitled to elect the director cast in favor of removing such director exceeds the number of votes cast against removal. Furthermore, any vacancy on our board of directors, however occurring, including a vacancy resulting from an increase in the size of our board, may only be filled by the affirmative vote of a majority of our remaining directors. The classification of directors, together with the limitations on removal of directors and treatment of vacancies, has the effect of making it more difficult for shareholders to change the composition of our board of directors.

Unanimous Written Consent of Shareholders

 

 

Washington law limits the ability of shareholders to act by written consent by requiring unanimous written consent for shareholder action to be effective. This limit may lengthen the amount of time required to take shareholder actions and would prevent the amendment of our Articles of Incorporation, our Bylaws or removal of directors by our shareholders without holding a meeting of shareholders.

 

Meetings of Shareholders

Our Articles of Incorporation and our Bylaws provide that only our board of directors, our Chairperson of our board of directors, our Chief Executive Officer or our President may call special meetings of shareholders and only those matters set forth in the notice of the special meeting may be considered or acted upon at a special meeting of shareholders. Our Bylaws limit the business that may be conducted at an annual meeting of shareholders to those matters properly brought before the meeting.

Advance Notice Requirements

Our Bylaws have established advance notice procedures with regard to shareholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of our shareholders. These procedures provide that notice of shareholder proposals must be timely given in writing to our corporate secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary of the date that our proxy statement was released to shareholders in connection with the previous year’s annual meeting. Our Bylaws specify the requirements as to form and content of all shareholders’ notices. These requirements may preclude shareholders from bringing matters before the shareholders at an annual or special meeting.

Amendment to our Articles of Incorporation and Bylaws

Any amendment of our Articles of Incorporation must first be submitted to our shareholders by us or our board of directors, and the amendment of certain articles or sections, including articles or sections relating to who may call special meetings of the shareholders, our board of directors, indemnification of our directors and officers, supermajority voting and amendments to our Bylaws, requires the affirmative vote of at least two-thirds of the outstanding shares entitled to vote on the amendment voting together as a single group. Our Bylaws may be amended by our board of directors, subject to any limitations set forth in our Bylaws, and may also be amended by the affirmative vote of at least two-thirds of the outstanding shares entitled to vote on the amendment voting together as a single group.

Undesignated Preferred Stock

Our Articles of Incorporation provide for authorized shares of preferred stock. The existence of authorized but unissued shares of preferred stock may enable our board of directors to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise. For example, if in the due exercise of its fiduciary obligations, our board of directors were to determine that a takeover proposal is not in the best interests of our shareholders, our board of directors could cause shares of preferred stock to be issued without shareholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer or insurgent shareholder or shareholder group. In this regard, our Articles of Incorporation grant our board of directors broad power to establish the rights and preferences of authorized and unissued shares of preferred stock. The issuance of shares of preferred stock could decrease the amount of earnings and assets available for distribution to holders of shares of common stock. The issuance may also adversely affect the rights and powers, including voting rights, of these holders and may have the effect of delaying, deterring or preventing a change in control of us.

Exclusive Forum

Our Articles of Incorporation provide that, unless we consent in writing to the selection of an alternative forum, the state courts located in King County, Washington (or, if the state courts located within King County, Washington do not have jurisdiction, the federal district court for the Western District of Washington) shall be the 

 

 

sole and exclusive forum for commencing and maintaining any proceeding (1) asserting a claim based on a violation of a duty under the laws of the State of Washington by any of our current or former directors, officers or shareholders in such capacity, (2) commenced or maintained in the right of the corporation, (3) asserting a claim arising pursuant to any provision of the Washington Business Corporation Act (“WBCA”), our Articles of Incorporation or our Bylaws (as either may be amended from time to time) or (4) asserting a claim concerning our internal affairs that is not included in clauses (1) through (3) above, in all cases to the fullest extent permitted by law and subject to the court having personal jurisdiction over the indispensable parties named as defendants. These provisions would not apply to suits brought to enforce a duty or liability created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts have exclusive jurisdiction. Our Articles of Incorporation further provide that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, subject to applicable law. Any person or entity purchasing or otherwise acquiring any interest in our securities shall be deemed to have notice of and consented to these provisions. Our exclusive forum provision will not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder, and our shareholders will not be deemed to have waived our compliance with these laws, rules and regulations. Although we believe these provisions benefit us by providing increased consistency in the application of Washington law for the specified types of actions and proceedings, the provisions may have the effect of discouraging lawsuits against us or our directors, officers and other employees.

Washington Anti-Takeover Law

Washington law imposes restrictions on some transactions between a corporation and significant shareholders. Chapter 23B.19 of the WBCA generally prohibits a target corporation from engaging in specified “significant business transactions” with an “acquiring person.” This statute could prohibit or delay the accomplishment of mergers or other takeover or change in control attempts with respect to us and, accordingly, may discourage unsolicited attempts to acquire us. An “acquiring person” is generally defined as a person or group of persons that beneficially owns the voting shares entitled to cast votes comprising 10% or more of the voting power of the target corporation. The target corporation may not engage in “significant business transactions,” as defined in Chapter 23B.19, for a period of five years after the date of the transaction in which the person became an acquiring person, unless (1) the significant business transaction or the acquiring person’s purchase of shares was approved by a majority of the members of the target corporation’s board of directors prior to the share acquisition causing the person to become an “acquiring person,” or (2) the significant business transaction was both approved by the majority of the members of the target corporation’s board of directors and authorized at a shareholder meeting by at least two-thirds of the votes entitled to be cast by the outstanding voting shares (excluding the acquiring person’s shares or shares over which the acquiring person has voting control) at or subsequent to the acquiring person’s share acquisition. “Significant business transactions” include, among other things:

 

	
 
	
•
	
 
	
a merger or share exchange with, disposition of assets to or issuance or redemption of stock to or from, the acquiring person;

 

	
 
	
•
	
 
	
a termination of 5% or more of the employees of the target corporation employed in the State of Washington as a result of the acquiring person’s acquisition of 10% or more of the shares, whether at one time or over the five-year period following the share acquisition;

 

	
 
	
•
	
 
	
a transaction in which the acquiring person is allowed to receive a disproportionate benefit as a shareholder; or

 

	
 
	
•
	
 
	
liquidating or dissolving the target corporation.

After the five-year period, a “significant business transaction” may occur, as long as it complies with “fair price” provisions specified in the statute or is approved at a meeting of shareholders by a majority of the votes entitled to be counted within each voting group entitled to vote separately on the transaction, not counting the votes of shares as to which the acquiring person has beneficial ownership or voting control. A corporation may not opt out of this statute.

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