NONPROFIT CORPORATION ACT (EXCERPT)
Act 162 of 1982
450.2338 Issuing certificates for fractions of share; purposes; rights of holders; paying fair value of fractions of share in cash; issuing scrip in registered or bearer form exchangeable for full shares; conditions; providing opportunity to purchase additional fractions of share or scrip.
(1) A corporation may issue certificates for fractions of a share where necessary to effect share transfer, share distributions, or a reclassification, merger, consolidation, or reorganization, which shall entitle the holders, in proportion to their fractional holdings, to exercise voting rights and participate in liquidating distributions.
(2) As an alternative, a corporation may pay in cash the fair value of fractions of a share as of the time when those entitled to receive the fractions are determined.
(3) As an alternative, a corporation may issue scrip in registered or bearer form over the manual or facsimile signature of an officer of the corporation or of its agent, exchangeable as therein provided for full shares, but such scrip shall not entitle the holder to any right of a shareholder except as therein provided. The scrip shall be issued subject to the condition that it becomes void if not exchanged for certificates representing full shares before a specified date. The scrip may be subject to the condition that the shares for which the scrip is exchangeable may be sold by the corporation and the proceeds of the sale distributed to the holders of the scrip, or subject to any other condition which the board may determine.
(4) A corporation may provide reasonable opportunity for persons entitled to fractions of a share or scrip to sell them or to purchase additional fractions of a share or scrip needed to acquire a full share.
History: 1982, Act 162, Eff. Jan. 1, 1983
© 2009 Legislative Council, State of Michigan