{"data":{"id":"us-ky/krs-271b.12-200","jurisdiction":"us-ky","citation":"KRS 271B.12-200","heading":"Definitions for KRS 271B.12-210 to 271B.12-230.","body":"As used in KRS 271B.12-210 to 271B.12-230:\n(1) \"Affiliate,\" including the term \"affiliated person,\" means a person who directly, or\nindirectly through one (1) or more intermediaries, controls, or is controlled by, or is\nunder common control with, a specified person.\n(2) \"Associate,\" when used to indicate a relationship with any person, means:\n(a) Any corporation or organization (other than the corporation or a subsidiary of\nthe corporation) of which such person is an officer, director or partner or is,\ndirectly or indirectly, the beneficial owner of ten percent (10%) or more of any\nclass of equity securities;\n(b) Any trust or other estate in which such person has a substantial beneficial\ninterest or as to which such person serves as trustee or in a similar f iduciary\ncapacity; and\n(c) Any relative or spouse of such person, or any relative of such spouse, any one\n(1) of whom has the same home as such person or is a director or officer of\nthe corporation or any of its affiliates.\n(3) \"Beneficial owner,\" when used with respect to any voting stock, means a person:\n(a) Who, individually or with any of its affiliates or associates, beneficially owns\nvoting stock, directly or indirectly; or\n(b) Who, individually or with any of its affiliates or associates, has:\n1. The right to acquire voting stock, whether such right is exercisable\nimmediately or only after the passage of time and whether or not such\nright is exercisable only after specified conditions are met, pursuant to\nany agreement, arrangement, or understanding o r upon the exercise of\nconversion rights, exchange rights, warrants or options, or otherwise;\n2. The right to vote voting stock pursuant to any agreement, arrangement,\nor understanding; or\n3. Any agreement, arrangement, or understanding for the purpose of\nacquiring, holding, voting or disposing of voting stock with any other\nperson who beneficially owns, or whose affiliates or associates\nbeneficially own, directly or indirectly, such shares of voting stock;\nhowever, for the purposes of this section and KRS 271B.12-230 the\nbeneficial owner of any voting stock held by, or owned through\nparticipation in, any purchase, savings, option, bonus, appreciation,\nprofit sharing, thrift, incentive, pension, stock ownership or similar plan\nfor employees or officers of th e corporation or any of its subsidiaries\nshall be deemed to be the shareholder of record of such voting stock as\nshown on the stock transfer books of the corporation.\n(4) \"Business combination\" means:\n(a) Unless the merger or consolidation does not alter the contract rights of the\nstock as expressly set forth in the articles of incorporation or change or\nconvert in whole or in part the outstanding shares of stock of the corporation,\nany merger or consolidat ion of the corporation or any subsidiary with any\ninterested shareholder or any other corporation, whether or not itself an\ninterested shareholder, which is, or after the merger or consolidation would\nbe, an affiliate or associate of an interested sharehol der who was an interested\nshareholder prior to the transaction;\n(b) Any sale, lease, transfer, or other disposition, other than in the ordinary course\nof business, in one (1) transaction or a series of transactions in any twelve -\nmonth period, to any interested shareholder or any affiliate or associate of any\ninterested shareholder, other than the corporation or any subsidiaries, of any\nassets of the corporation or any subsidiary having, measured at the time the\ntransaction or transactions are approved by th e board of directors of the\ncorporation, an aggregate book value as of the end of the corporation's most\nrecently ended fiscal quarter of five percent (5%) or more of the total market\nvalue of the outstanding stock of the corporation or of its net worth as  of the\nend of its most recently ended fiscal quarter;\n(c) The issuance or transfer by the corporation, or any subsidiary, in one\ntransaction or a series of transactions in any twelve -month period, of any\nequity securities of the corporation or any subsidi ary which have an aggregate\nmarket value of five percent (5%) or more of the total market value of the\noutstanding stock of the corporation, determined as of the end of the\ncorporation's most recently ended fiscal quarter prior to the first such issuance\nor transfer, to any interested shareholder or any affiliate or associate of any\ninterested shareholder, other than the corporation or any of its subsidiaries,\nexcept pursuant to the exercise of warrants or rights to purchase securities\noffered pro rata to a ll holders of the corporation's voting stock or any other\nmethod affording substantially proportionate treatment to the holders of\nvoting stock;\n(d) The adoption of any plan or proposal for the liquidation or dissolution of the\ncorporation in which anythin g other than cash will be received by an\ninterested shareholder or any affiliate or associate of any interested\nshareholder; or\n(e) Any reclassification of securities, including any reverse stock split; or\nrecapitalization of the corporation; or any merger  or consolidation of the\ncorporation with any of its subsidiaries; or any other transaction which has the\neffect, directly or indirectly, in one transaction or a series of transactions, of\nincreasing by five percent (5%) or more the proportionate amount of  the\noutstanding shares of any class of equity securities of the corporation or any\nsubsidiary which is directly or indirectly beneficially owned by any interested\nshareholder or any affiliate or associate of any interested shareholder; or\n(f) Any receipt by an interested shareholder or any affiliate or associate of such\ninterested shareholder of the benefit directly or indirectly, except\nproportionately as a shareholder of such corporation, of any loans, advances,\nguaranties, pledges or other financial assistance, or any tax credits or other tax\nadvantages provided by or through such corporation.\n(5) \"Common stock\" means any stock other than preferred or preference stock.\n(6) \"Continuing director\" means any member of the board of directors who is not an\naffiliate or associate of an interested shareholder or any of its affiliates, other than\nthe corporation or any of its subsidiaries, and who was a director of the corporation\nprior to the time the interested shareholder became an interested shareholder, and\nany successor to such continuing director who is not an affiliate or associate of an\ninterested shareholder or any of its affiliates, other than the corporation or any of its\nsubsidiaries, and was recommended or elected by a majority of the continuing\ndirectors at a meeting at which a quorum consisting of a majority of the continuing\ndirectors is present.\n(7) \"Control,\" including the terms \"controlling,\" \"controlled by\" and \"under common\ncontrol with,\" means the possession, directly or indirectly, of the pow er to direct or\ncause the direction of the management and policies of a person, whether through the\nownership of voting securities, by contract, or otherwise, and the beneficial\nownership of ten percent (10%) or more of the votes entitled to be cast by a\ncorporation's voting stock creates a presumption of control.\n(8) \"Equity security\" means:\n(a) Any stock or similar security, certificate of interest, or participation in any\nprofit-sharing agreement, voting trust certificate, or certificate of deposit for\nthe foregoing;\n(b) Any security convertible, with or without consideration, into an equity\nsecurity, or any warrant or other security carrying any right to subscribe to or\npurchase an equity security; or\n(c) Any put, call, straddle, or other option, right o r privilege of acquiring an\nequity security from or selling an equity security to another without being\nbound to do so.\n(9) \"Independent member\" of the board of directors means any director who is not an\nofficer or full -time employee of the corporation or an affiliate or associate of an\ninterested shareholder or any of its affiliates.\n(10) \"Interested shareholder\" means any person, other than the corporation or any of its\nsubsidiaries, who:\n(a) Is the beneficial owner, directly or indirectly, of ten percent  (10%) or more of\nthe voting power of the outstanding voting stock of the corporation; or is an\naffiliate of the corporation and at any time within the five (5) year period\nimmediately prior to the date in question was the beneficial owner, directly or\nindirectly, of ten percent (10%) or more of the voting power of the then\noutstanding voting stock of the corporation. The term interested shareholder\nshall not mean any entity or person holding or owning voting stock for, or\nthrough participation in, any purc hase, savings, option, bonus, appreciation,\nprofit sharing, thrift, incentive, pension, stock ownership or similar plan for\nemployees or officers of the corporation or any of its subsidiaries.\n(b) For the purpose of determining whether a person is an inter ested shareholder,\nthe number of shares of voting stock deemed to be outstanding shall include\nshares deemed owned by the person through application of subsection (3) of\nthis section, but shall not include any other shares of voting stock which may\nbe issu able pursuant to any agreement, arrangement, or understanding, or\nupon exercise of conversion rights, warrants or options, or otherwise.\n(11) \"Market value\" means:\n(a) In the case of stock, the highest closing sale price during the thirty -day period\nimmediately preceding the date in question of a share of such stock on the\ncomposite tape for New York stock exchange listed stocks, or, if such stock is\nnot quoted on the composite tape on the New York stock exchange, or if such\nstock is not listed on such exch ange, on the principal United States securities\nexchange registered under the Securities Exchange Act of 1934 on which such\nstock is listed, or, if such stock is not listed on any such exchange, the highest\nclosing bid quotation with respect to a share of such stock during the thirty -\nday period preceding the date in question on the National Association of\nSecurities Dealers, Inc., Automated Quotations System or any system then in\nuse, or if no such quotations are available, the fair market value on the date  in\nquestion of a share of such stock as determined by a majority of the continuing\ndirectors at a meeting of the board of directors at which a quorum consisting\nof at least a majority of the continuing directors is present; and\n(b) In the case of property  other than cash or stock, the fair market value of such\nproperty on the date in question as determined by a majority of the continuing\ndirectors at a meeting of the board of directors at which a quorum consisting\nof at least a majority of the continuing directors is present.\n(12) \"Subsidiary\" means any corporation of which voting stock having a majority of the\nvotes entitled to be cast is owned, directly or indirectly, by the corporation.\n(13) \"Voting stock\" means shares of capital stock of a corporation e ntitled to vote\ngenerally in the election of directors.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=13429","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:53:19Z","sha256":"8e6e3c78bb892c717c9a24dc55304d38ae5bd54f2e42315c8d51b1d6d687dbe6","source_id":"us-ky","stale":false,"prev":"us-ky/krs-271b.12-030","next":"us-ky/krs-271b.12-210"},"notice":"GroundRules: Original legal text. Not legal advice."}