Introduced
by
To prohibit shareholders of a publicly traded company from removing a corporation's directors without cause unless the articles of incorporation explicitly allow this, and require approval by the board of directors for any changes a majority of shareholders vote to make to the company's articles, including a change to allow the removal of board members without cause. The bill would also clarify a provision of Michigan’s 1988 anti-corporate takeover law which prohibits groups of shareholders from pooling their voting rights when a struggle for corporate control is underway. The law was intended to apply only to the potential buyer of a company, but a recent court ruling applied it to the original owners as well. The bill would have the effect of only applying the law to the potential buyer, and not the original owners of the company. The bill was introduced at the same time that the Indianapolis-based Simon Property Group is attempting to acquire Taubman Centers, which owns shopping malls, and would allow Taubman to defeat the acquisition. See also Senate Bill 218.
Referred to the Committee on Commerce
Reported without amendment
With the recommendation that the substitute (H-3) be adopted and that the bill then pass.
Substitute offered
To replace the previous version of the bill with one recommended by the Commerce Committee, which would remove the retroactivity from the provision clarifying that a prohibition on groups of shareholders pooling their voting rights during a corporate takeover struggle does not apply to the original owners as well. The revised provision would therefore apply prospectively, but not in the Taubman-Simon dispute. The substitute would also revise the provisions prohibiting shareholders from removing a corporation's directors without cause to allow the removal if 75 percent of the shareholders in each class of stock voted to do so. Note: In the Taubman-Simon dispute, the Taubman family owns more than 75 percent of a particular class of shares, but not 75 percent of all shares.
The substitute failed by voice vote
Substitute offered
by
To replace the previous version of the bill with one which would strip out the provisions prohibiting shareholders from removing a corporation's directors except for cause, and requiring approval by the board of directors for any changes made by shareholders to the company's articles, or in the term length or number of directors. It would also have the effect of making the revised anti-takeover pooling of voting rights provision retroactive.
The substitute passed by voice vote
Amendment offered
by
To strip out the retroactive anti-takeover language.
The amendment failed by voice vote
Passed in the House 77 to 27 (details)
To clarify a provision of Michigan’s 1988 anti-corporate takeover law which prohibits groups of shareholders in a publicly traded company from pooling their voting rights when a struggle for corporate control is underway. The law was intended to apply only to the potential buyer of a company, but a recent court ruling applied it to the original owners as well. The bill would have the effect of only applying the law to the potential buyer, and not the original owners of the company. The bill was introduced at the same time that the Indianapolis-based Simon Property Group is attempting to acquire Taubman Centers, which owns shopping malls, and would allow Taubman to defeat the acquisition. See also Senate Bill 218.
Referred to the Committee on Commerce and Labor
Reported without amendment
With the recommendation that the bill pass.
Passed in the Senate 24 to 14 (details)
To clarify a provision of Michigan’s 1988 anti-corporate takeover law which prohibits groups of shareholders in a publicly traded company from pooling their voting rights when a struggle for corporate control is underway. The law was intended to apply only to the potential buyer of a company, but a recent court ruling applied it to the original owners as well. The bill would have the effect of only applying the law to the potential buyer, and not the original owners of the company. The bill was introduced at the same time that the Indianapolis-based Simon Property Group is attempting to acquire Taubman Centers, which owns shopping malls, and would allow Taubman to defeat the acquisition. See also Senate Bill 218.
