Shareholder Fairness Amendments of 1985

Summary

Shareholder Fairness Amendments of 1985 - Amends the Securities Exchange Act of 1934 to prohibit any person from acquiring certain equity securities if as a result of such acquisition such person would own: (1) between 15 and 35 percent of the outstanding voting securities of the issuer, unless the tender offer is open to all holders of the class of securities involved; (2) over 35 percent of the outstanding voting securities of the issuer, unless the tender offer is made to all holders of the class of securities involved at the same price per share, or the acquiring person will purchase all securities of such class at such price within 12 months. Sets forth the procedure for determining the value of securities offered as consideration in such an offer. Provides that such prohibition shall not apply where: (1) the person acquiring the securities is the issuer of such securities; (2) the acquisition is by employee benefit plan, by pension fund of the issuer, or by gift, inheritance, or transfer among relatives; or (3) the acquiring person already owns more than the applicable percentage of voting securities and will not increase the percentage owned as a result of such acquisition. Requires any person whose acquisition results in ownership of more than five percent of an issuer's equity securities to file specified information with the issuer, appropriate exchanges, and the Securities and Exchange Commission within two (currently ten) days. Prohibits such person from acquiring additional shares of such securities for two business days after filing. Authorizes the Commission to exempt any person from such restrictions in the public interest. Directs the Commission to issue rules prohibiting an issuer of securities from granting voting power or issuing any securities that would entitle the holder of such voting power or securities to purchase securities of a successor corporation or another corporation at less than market value, entitle the holder of such securities to purchase securities of the issuer at less than market value, or require the issuer to repurchase its securities at greater than market value, if such entitlement or requirement is conditioned upon a contest for control of the issuer, a change in control of the issuer, or the acquisition of securities by a third party. Authorizes the Commission to provide exemptions to such prohibition. Requires tender offers for any class of certain equity securities to be open to all holders of securities of such class (with specified exceptions) and to pay to each holder the highest consideration offered to any holder. Allows the Commission to waive such requirement if it is not necessary in the public interest or for the protection of investors.

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1 official file

• Introduced in Senate

  summary · EN · 22 November 1985

  Open at official source

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