2023 Montana Code Annotated › Title 35. Corporations, Partnerships, and Associations › Chapter 14. Montana Business Corporation Act › Part 13. Appraisal Rights › 35-14-1301. Definitions -- appraisal rights

35-14-1301. Definitions -- appraisal rights.
For the purposes of this part, the following definitions apply:
(1) "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 or is a senior executive of another person. For purposes of 35-14-1302(2)(d), a person is considered an affiliate of its senior executives.
(2) "Beneficial owner" means any person who directly, or indirectly through any contract, arrangement, or understanding, other than a revocable proxy, has or shares the power to vote or to direct the voting of shares. However, a member of a national securities exchange is not considered a beneficial owner of securities held directly or indirectly by it on behalf of another person if the member is precluded by the rules of the exchange from voting without instruction on contested matters or matters that may affect substantially the rights or privileges of the holders of the securities to be voted. When two or more persons agree to act together for the purpose of voting their shares of the corporation, each member of the group formed is held to have acquired beneficial ownership, as of the date of the agreement, of all shares having voting power of the corporation that are beneficially owned by any member of the group.
(3) "Corporation" means the domestic corporation that is the issuer of the shares held by a shareholder demanding appraisal and, for matters covered in 35-14-1322 through 35-14-1326, 35-14-1330, and 35-14-1331, includes the survivor of a merger.
(4) "Excluded shares" means shares acquired pursuant to an offer for all shares having voting power if the offer was made within 1 year before the corporate action for consideration of the same kind and of a value equal to or less than that paid in connection with the corporate action.
(5) "Fair value" means the value of the corporation's shares determined:
(a) immediately before the effectiveness of the corporate action to which the shareholder objects;
(b) using customary and current valuation concepts and techniques generally employed for similar businesses in the context of the transaction requiring appraisal; and
(c) without discounting for lack of marketability or minority status except, if appropriate, for amendments to the articles of incorporation pursuant to 35-14-1302(1)(d).
(6) "Interest" means interest from the date the corporate action becomes effective until the date of payment, at the rate of interest on judgments in this state on the effective date of the corporate action.
(7) "Interested person" means a person or an affiliate of a person who at any time during the 1-year period immediately preceding approval by the board of directors of the corporate action:
(a) was the beneficial owner of 20% or more of the voting power of the corporation, other than as owner of excluded shares;
(b) had the power, contractually or otherwise and other than as owner of excluded shares, to cause the appointment or election of 25% or more of the directors to the board of directors of the corporation; or
(c) was a senior executive or director of the corporation or a senior executive of any affiliate of the corporation and will receive, as a result of the corporate action, a financial benefit not generally available to other shareholders, other than:
(i) employment, consulting, retirement, or similar benefits established separately and not as part of or in contemplation of the corporate action;
(ii) employment, consulting, retirement, or similar benefits established in contemplation of or as part of the corporate action that are not more favorable than those existing before the corporate action or, if more favorable, that have been approved on behalf of the corporation in the same manner as is provided in 35-14-862; or
(iii) in the case of a director of the corporation who will, in the corporate action, become a director or governor of the acquiror or any of its affiliates, rights and benefits as a director or governor that are provided on the same basis as those afforded by the acquiror generally to other directors or governors of the entity or affiliate.
(8) "Interested transaction" means a corporate action described in 35-14-1302(1), other than a merger pursuant to 35-14-1105, involving an interested person in which any of the shares or assets of the corporation are being acquired or converted.
(9) "Preferred shares" means a class or series of shares whose holders have preference over any other class or series of shares with respect to distributions.
(10) "Senior executive" means the chief executive officer, chief operating officer, chief financial officer, and any individual in charge of a principal business unit or function.
(11) "Shareholder" means a record shareholder, a beneficial shareholder, and a voting trust beneficial owner.
History: En. Sec. 171, Ch. 271, L. 2019.