ROBERT L. EHRLICH, JR., Governor

Ch. 301

supplementary with respect to the stock are effective shall cease to be voidable
at the time the articles supplementary become effective; providing that a right
or liability accrued by reason of the issuance of the stock prior to the time the
articles supplementary are effective shall be extinguished at the time the
articles supplementary become effective under certain circumstances; clarifying
that a direct or indirect transfer of money or other property of a corporation in
respect of any of its shares is a distribution; authorizing the board of directors of
a corporation to delegate to a committee of the board or an officer of the
corporation the power to fix the amount and other terms of a distribution under
certain circumstances; altering certain notice requirements with respect to
certain parent and subsidiary mergers; clarifying that certain stockholders
retain their appraisal rights under certain circumstances; making certain
stylistic, conforming, and technical changes; and generally relating to Maryland
corporations.

BY repealing and reenacting, with amendments,
Article — Corporations and Associations

Section 2-208, 2-208.1, 2-301(a), 2-407(a), 2-411(a), 3-106(d), and 3-202(c)
Annotated Code of Maryland
(1999 Replacement Volume and 2002 Supplement)

BY adding to

Article - Corporations and Associations

Section 2-309(c)

Annotated Code of Maryland

(1999 Replacement Volume and 2002 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article - Corporations and Associations

2-208.

(a)     (1) If, under a power contained in the charter, the board of directors
classifies or reclassifies any unissued stock by setting or changing the preferences,
conversion or other rights, voting powers, restrictions, limitations as to dividends,
qualifications, or terms or conditions of redemption, the board shall file articles
supplementary for record with the Department.

(2) The board may not issue any of the stock that is classified or
reclassified prior to the time the articles supplementary are effective, as provided in
this section.

(b)     Articles supplementary shall include:

(1) A description of the stock, including the preferences, conversion and
other rights, voting powers, restrictions, limitations as to dividends, qualifications,
and terms and conditions of redemption, as set or changed by the board of directors;
and

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