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Both class A voting and class B nonvoting shareholders are
entitled to the same dividends (without preference) on a per-share
basis, if and when declared by the board of directors of J.R.
Simplot Co. As of the date of decedent's death, J.R. Simplot Co.
had never declared a dividend.
Pursuant to J.R. Simplot Co.'s articles of incorporation, upon
liquidation of J.R. Simplot Co., the Company's assets are to be
used in the following order of priority: (1) Payment of all
outstanding indebtedness; (2) payment to the class B nonvoting
shareholders in an amount equal to the par value of their shares
($10 per share) plus a dividend equal to 40 cents per share for
each year that the stock is outstanding after July 1, 1955, up to
the last day of the February preceding the liquidation date; (3)
payment to the class A voting shareholders in an amount equal to
the par value of their shares ($10 per share); and (4) payment of
the balance to all class A voting and class B nonvoting
shareholders pro rata on a per-share basis.
The articles of incorporation and the bylaws of J.R. Simplot
Co. place a 360-day restriction on the transferability or
hypothecation of the class A voting stock. Pursuant to this
restriction, if a class A voting shareholder desires to sell,
transfer, or hypothecate his/her class A voting stock, the stock
must be first offered to the Company under the same terms and
conditions as otherwise could be obtained by the selling
shareholder from another purchaser or lender for a period of 180
days. If the Company declines to exercise its right during this
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