Bill Text: OR HB2695 | 2011 | Regular Session | Introduced

Oregon House Bill 2695 (Prior Session Legislation)

Introduced

Bill Title: Relating to standards of conduct for directors of corporations.

Sponsorship: Unknown

Status: (Failed) 2011-06-30 - In committee upon adjournment. [HB2695 Detail]

Download: Oregon-2011-HB2695-Introduced.html



     76th OREGON LEGISLATIVE ASSEMBLY--2011 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 1162

                         House Bill 2695

Introduced and printed pursuant to House Rule 12.00. Presession
  filed (at the request of House Interim Committee on Judiciary)

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.

  Authorizes director of corporation to consider certain
interests in determining what director believes to be in
corporation's best interests.

                        A BILL FOR AN ACT
Relating to standards of conduct for directors of corporations;
  amending ORS 60.357.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 60.357 is amended to read:
  60.357. (1) A director shall discharge the duties of a
director, including   { - the - }  duties as a member of a
committee, in good faith, with the care an ordinarily prudent
person in a like position would exercise under similar
circumstances and in a manner the director reasonably believes
 { - to be - }  { +  is + } in the best interests of the
corporation.
  (2) In discharging the duties of a director, a director is
entitled to rely on information, opinions, reports or
statements { + , + } including financial statements and other
financial data, if prepared or presented by:
  (a) One or more officers or employees of the corporation whom
the director reasonably believes   { - to be - }  { +  are + }
reliable and competent in the matters presented;
  (b) Legal counsel, public accountants or other persons as to
matters the director reasonably believes are within the person's
professional or expert competence; or
  (c) A committee of the board of directors of which the director
is not a member if the director reasonably believes the committee
merits confidence.
  (3) A director is not acting in good faith if the director has
knowledge concerning the matter in question that makes reliance
otherwise permitted by subsection (2) of this section
unwarranted.
  (4) A director is not liable for   { - any - }  { +  an + }
action taken as a director, or   { - any - }  { +  a + } failure
to take   { - any - }  { +  an + } action, if the director
performed the duties of the director's office in compliance with
this section.
    { - (5) When evaluating any offer of another party to make a
tender or exchange offer for any equity security of the
corporation, or any proposal to merge or consolidate the
corporation with another corporation or to purchase or otherwise
acquire all or substantially all the properties and assets of the
corporation, the directors of the corporation may, in determining
what they believe to be in the best interests of the corporation,
give due consideration to the social, legal and economic effects
on employees, customers and suppliers of the corporation and on
the communities and geographical areas in which the corporation
and its subsidiaries operate, the economy of the state and
nation, the long-term as well as short-term interests of the
corporation and its shareholders, including the possibility that
these interests may be best served by the continued independence
of the corporation, and other relevant factors. - }
   { +  (5)(a) A director, in determining how to discharge the
director's duties in a manner that the director reasonably
believes is in the best interests of the corporation, may
consider the corporation's short-term and long-term interests and
may give due consideration to other relevant factors, including
but not limited to:
  (A) Economic, environmental, social or ethical factors that are
reasonably regarded as appropriate to the responsible conduct of
the corporation's business;
  (B) The interests of the corporation's employees, customers or
suppliers or other persons that have business relationships with
the corporation; or
  (C) Effects on the communities or geographical areas in which
the corporation operates.
  (b) If the director is evaluating a tender or exchange offer
for an equity security of the corporation, a proposal to merge or
consolidate the corporation with another business entity or a
proposal to purchase or otherwise acquire all or substantially
all of the corporation's properties and assets, in addition to
the factors described in paragraph (a) of this subsection the
director may give due consideration to the possibility that the
corporation's interests are best served by the corporation's
continued independence. + }
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