2007 Oregon Code - Chapter 60 :: Chapter 60 - Private Corporations
Chapter 60 Private
Corporations
2007 EDITION
PRIVATE CORPORATIONS
CORPORATIONS AND PARTNERSHIPS
GENERAL PROVISIONS
(Definitions)
60.001 Definitions
(Filing Documents)
60.004 Filing
requirements
60.007 Filing,
service, copying and certification fees
60.011 Effective
time and date of document
60.014 Correcting
filed document
60.016 Forms;
rules
60.017 Filing
duty of Secretary of State
60.021 Appeal
from Secretary of States refusal to file document
60.024 Evidentiary
effect of copy of filed document
60.027 Certificate
of existence or authorization
(Secretary of State)
60.031 Powers
(Notice)
60.034 Notice
INCORPORATION
60.044 Incorporators
60.047 Articles
of incorporation
60.051 Incorporation
60.054 Liability
for preincorporation transactions
60.057 Organization
of corporation
60.061 Bylaws
60.064 Emergency
bylaws
PURPOSES AND POWERS
60.074 Purposes
60.077 General
powers
60.081 Emergency
powers
60.084 Validity
of corporate acts
NAME
60.094 Corporate
name
60.097 Reserved
name
60.101 Registered
name
OFFICE AND AGENT
60.111 Registered
office and registered agent
60.114 Change
of registered office or registered agent
60.117 Resignation
of registered agent
60.121 Service
on corporation
SHARES AND DISTRIBUTIONS
(Shares)
60.131 Authorized
shares
60.134 Terms
of class or series determined by board of directors
60.137 Issued
and outstanding shares
60.141 Fractional
shares
(Issuance of Shares)
60.144 Subscription
for shares before incorporation
60.147 Issuance
of shares
60.151 Liability
of shareholders
60.154 Share
dividends
60.157 Share
rights, options and warrants
60.161 Form
and content of certificates
60.164 Shares
without certificates
60.167 Restriction
on transfer of shares and other securities
60.171 Expense
of issue
(Subsequent Acquisition of Shares by
Shareholders and Corporation)
60.174 Preemptive
rights of shareholders
60.177 Corporations
acquisition of its own shares
(Distributions)
60.181 Distributions
to shareholders
SHAREHOLDERS
(Meetings)
60.201 Annual
meeting
60.204 Special
meeting
60.207 Court-ordered
meeting
60.209 Meeting
chairperson; closing of polls
60.211 Action
without meeting
60.214 Notice
of meeting
60.217 Waiver
of notice
60.219 Adjournment
of meeting
60.221 Record
date
60.222 Participation
at meeting
60.223 Meeting
inspectors; duties
(Voting)
60.224 Shareholders
list for meeting
60.227 Voting
entitlement of shares
60.231 Proxies
60.234 Shares
held by nominees
60.237 Corporations
acceptance of votes
60.241 Quorum
and voting requirements for voting groups
60.244 Action
by single and multiple voting groups
60.247 Modification
of quorum or voting requirements
60.251 Voting
for directors
(Voting Trusts and Agreements)
60.254 Voting
trusts
60.257 Voting
agreements
(Derivative Proceedings)
60.261 Derivative
proceedings
(Shareholder Agreements)
60.265 Validity
of shareholder agreements inconsistent with chapter; purposes; notice of
agreement; effect on liability
DIRECTORS AND OFFICERS
(Board of Directors)
60.301 Requirement
for and duties of board of directors
60.304 Qualifications
of directors
60.307 Number
and election of directors
60.311 Election
of directors by certain classes of shareholders
60.314 Terms
of directors generally
60.317 Staggered
terms for directors
60.321 Resignation
of directors
60.324 Removal
of directors by shareholders
60.327 Removal
of directors by judicial proceeding
60.331 Vacancy
on board
60.334 Compensation
of directors
(Meetings and Action of Board)
60.337 Meetings
60.341 Action
without meeting
60.344 Notice
of meeting
60.347 Waiver
of notice
60.351 Quorum
and voting
60.354 Committees;
powers; limitations
(Standards of Conduct)
60.357 General
standards for directors
60.361 Conflict
of interest
60.364 Loans
to directors
60.367 Liability
for unlawful distributions
(Officers)
60.371 Required
officers
60.374 Duties
of officers
60.377 Standard
of conduct for officers
60.381 Resignation
and removal of officers
60.384 Contract
right of officers
(Indemnification)
60.387 Definitions
for ORS 60.387 to 60.414
60.391 Authority
to indemnify directors
60.394 Mandatory
indemnification
60.397 Advance
for expenses
60.401 Court-ordered
indemnification
60.404 Determination
and authorization of indemnification
60.407 Indemnification
of officers, employees and agents
60.411 Insurance
60.414 Application
of ORS 60.387 to 60.411
AMENDMENT OF ARTICLES OF INCORPORATION AND
BYLAWS
(Amendment of Articles of Incorporation)
60.431 Authority
60.434 Amendment
by board of directors
60.437 Amendment
by board of directors and shareholders
60.441 Voting
on amendments by voting groups
60.444 Amendment
before issuance of shares
60.447 Articles
of amendment
60.451 Restated
articles of incorporation
60.454 Amendment
pursuant to reorganization
60.457 Effect
of amendment
(Amendment of Bylaws)
60.461 Amendment
or repeal by board of directors or shareholders
60.464 Bylaw
increasing quorum or voting requirement for shareholders
60.467 Bylaw
increasing quorum or voting requirement for directors
CONVERSION, MERGER AND SHARE EXCHANGE
60.470 Definitions
for ORS 60.470 to 60.501
60.472 Conversion
60.474 Action
on plan of conversion
60.476 Articles
of conversion
60.478 Effect
of conversion; assumed business name
60.481 Merger
60.484 Share
exchange
60.487 Action
on plan of merger or share exchange
60.491 Merger
with subsidiary
60.494 Articles
of merger or share exchange
60.497 Effect
of merger or share exchange
60.501 Merger
or share exchange with foreign corporation
60.531
60.534
DISSENTERS RIGHTS
(Right to Dissent and Obtain Payment for
Shares)
60.551 Definitions
for ORS 60.551 to 60.594
60.554 Right
to dissent
60.557 Dissent
by nominees and beneficial owners
(Procedure for Exercise of Rights)
60.561 Notice
of dissenters rights
60.564 Notice
of intent to demand payment
60.567 Dissenters
notice
60.571 Duty
to demand payment
60.574 Share
restrictions
60.577 Payment
60.581 Failure
to take action
60.584 After-acquired
shares
60.587 Procedure
if shareholder dissatisfied with payment or offer
(Judicial Appraisal of Shares)
60.591 Court
action
60.594 Court
costs and counsel fees
DISSOLUTION
(Voluntary Dissolution)
60.621 Dissolution
by incorporators or initial directors
60.624 Voluntary
dissolution by consent of shareholders
60.627 Dissolution
by board of directors and shareholders
60.631 Articles
of dissolution
60.634 Revocation
of dissolution
60.637 Effect
of dissolution
60.641 Known
claims against dissolved corporation
60.644 Unknown
claims against dissolved corporation
60.645 Enforcement
of claims against dissolved corporation
(Administrative Dissolution)
60.647 Grounds
for administrative dissolution
60.651 Procedure;
effect of administrative dissolution
60.654 Reinstatement
following administrative dissolution
60.657 Appeal
from denial of reinstatement
(Judicial Dissolution)
60.661 Grounds
for judicial dissolution
60.664 Procedure
for judicial dissolution
60.667 Receivership
or custodianship
60.671 Judgment
of dissolution
(Disposition of Assets)
60.674 Asset
distribution; deposit with Department of State Lands; claims
FOREIGN CORPORATIONS
(Authority to Transact Business)
60.701 Authority
to transact business required
60.704 Consequences
of transacting business without authority
60.707 Application
for authority to transact business
60.711 Amendment
to application for authority
60.714 Effect
of authority
60.717 Corporate
name of foreign corporation
60.721 Registered
office and registered agent of foreign corporation
60.724 Change
of registered office or registered agent of foreign corporation
60.727 Resignation
of registered agent of foreign corporation
60.731 Service
on foreign corporation
(Withdrawal)
60.734 Withdrawal
of foreign corporation
(Revocation of Authority)
60.737 Grounds
for revocation
60.741 Procedure
for and effect of revocation
60.744 Appeal
from revocation
60.747 Reinstatement
of authority
RECORDS AND REPORTS
(Records)
60.771 Corporate
records
60.774 Inspection
of records by shareholders
60.777 Scope
of inspection right
60.781 Court-ordered
inspection
(Reports)
60.784 Reports
to shareholders of indemnification
60.787 Annual
report
REGULATION OF CORPORATE ACQUISITIONS
60.801 Definitions
for ORS 60.801 to 60.816
60.804 Applicability
of ORS 60.801 to 60.816
60.807 Voting
rights of control shares
60.810 Acquiring
person statement; shareholder meeting
60.813 Dissenters
rights
60.816 Short
title
BUSINESS COMBINATIONS WITH INTERESTED
SHAREHOLDERS
60.825 Definitions
for ORS 60.825 to 60.845
60.830 Ownership
of shares
60.835 Prohibited
business combinations
60.840 Exceptions
to ORS 60.835
60.845 Greater
vote of shareholders prohibited
MISCELLANEOUS
60.951 Short
title
60.952 Court
proceeding by shareholder in close corporation; conditions; court-ordered
remedies; share purchase; expenses
60.954 Reservation
of power to amend or repeal
60.957 Application
to existing domestic corporation
60.961 Application
to qualified foreign corporations
60.964 Saving
provisions
60.967 Corporations
incorporated under special acts
60.971 Severability
PENALTY
60.992 Penalty
for signing false document
GENERAL PROVISIONS
(Definitions)
60.001
Definitions. As used in this
chapter:
(1) Anniversary means that day each year
exactly one or more years after:
(a) The date of filing by the Secretary of
State of the articles of incorporation in the case of a domestic corporation.
(b) The date of filing by the Secretary of
State of an application for authority to transact business in the case of a
foreign corporation.
(2) Articles of incorporation include
amended and restated articles of incorporation, articles of conversion and
articles of merger.
(3) Authorized shares means the shares
of all classes a domestic or foreign corporation is authorized to issue.
(4) Conspicuous means so written that a
reasonable person against whom the writing is to operate should have noticed it.
For example, printing in italics, boldface or contrasting color, typing in
capitals or underlined is conspicuous.
(5) Corporation or domestic corporation
means a corporation for profit, which is not a foreign corporation,
incorporated under or subject to the provisions of this chapter.
(6) Delivery means any method of
delivery used in conventional commercial practice, including delivery by hand,
mail, commercial delivery and electronic transmission.
(7) Distribution means a direct or
indirect transfer of money or other property, except of a corporations own
shares, or incurrence of indebtedness by a corporation to or for the benefit of
its shareholders in respect of any of its shares. A distribution may be in the
form of a declaration or payment of a dividend, a purchase, redemption or other
acquisition of shares, a distribution of indebtedness, or otherwise.
(8) Domestic limited liability company
means an entity that is an unincorporated association having one or more
members and that is organized under ORS chapter 63.
(9) Domestic nonprofit corporation means
a corporation not for profit incorporated under ORS chapter 65.
(10) Domestic professional corporation
means a corporation organized under ORS chapter 58 for the purpose of rendering
professional services and for the purposes provided under ORS chapter 58.
(11) Electronic signature has the
meaning given that term in ORS 84.004.
(12) Electronic transmission means any
process of communication that does not directly involve the physical transfer
of paper and that is suitable for the retention, retrieval and reproduction of
information by the recipient.
(13) Employee includes an officer but
not a director. A director may accept duties that make the director also an
employee.
(14) Entity includes a corporation,
foreign corporation, nonprofit corporation, profit and nonprofit unincorporated
association, business trust, estate, partnership, trust, two or more persons
having a joint or common economic interest, any state, the
(15) Foreign corporation means a
corporation for profit incorporated under a law other than the law of this
state.
(16) Foreign limited liability company
means an entity that is an unincorporated association organized under the laws
of a state other than this state, under the laws of a federally recognized
Indian tribe or under the laws of a foreign country and that is organized under
a statute under which an association may be formed that affords to each of its
members limited liability with respect to liabilities of the entity.
(17) Foreign nonprofit corporation means
a corporation not for profit organized under the laws of a state other than
this state.
(18) Foreign professional corporation
means a professional corporation organized under the laws of a state other than
this state.
(19) Governmental subdivision includes
an authority, county, district and municipality.
(20) Includes denotes a partial
definition.
(21) Individual means a natural person. Individual
includes the estate of an incompetent individual or a deceased individual.
(22) Means denotes an exhaustive
definition.
(23) Office, when used to refer to the
administrative unit directed by the Secretary of State, means the office of the
Secretary of State.
(24) Person includes individual and
entity.
(25) Principal office means the office,
in or out of this state, where the principal executive offices of a domestic or
foreign corporation are located and designated in the annual report or
application for authority to transact business in this state.
(26) Proceeding includes civil,
criminal, administrative and investigatory action.
(27) Record date means the date
established under this chapter on which a corporation determines the identity
of its shareholders and their shareholdings for purposes of this chapter. The
determinations shall be made as of the close of business on the record date
unless another time for doing so is specified when the record date is fixed.
(28) Shares means the units into which
the proprietary interest in a corporation are divided.
(29) Shareholder means the person in
whose name shares are registered in the records of a corporation or the
beneficial owner of shares to the extent of the rights granted by a nominee
certificate on file with a corporation.
(30) Signature includes any manual,
facsimile, conformed or electronic signature.
(31) State, when referring to a part of
the
(32) Subscriber means a person who
subscribes for shares in a corporation, whether before or after incorporation.
(33)
(34) Voting group means all shares of
one or more classes or series that under the articles of incorporation or this
chapter are entitled to vote and be counted together collectively on a matter
at a meeting of shareholders. All shares entitled by the articles of
incorporation or this chapter to vote generally on the matter are for that
purpose a single voting group. [1987 c.414 §64; 1989 c.1040 §2; 1999 c.362 §3;
1999 c.371 §2; 2001 c.104 §16; 2001 c.315 §32; 2003 c.80 §1; 2005 c.107 §1]
(Filing
Documents)
60.004
Filing requirements. (1) A
document must satisfy the requirements of this section except as any other
section modifies these requirements, to be entitled to filing by the Secretary
of State.
(2) This chapter must require or permit
filing the document with the office.
(3) The document shall contain the
information required by this chapter. It may contain other information as well.
(4) The document must be legible.
(5) The document must be in the English
language. The certificate of existence required of foreign corporations need
not be in English if accompanied by a reasonably authenticated English
translation.
(6) The document must be executed:
(a) By the chair of the board of directors
of a domestic or foreign corporation, its president or another of its officers;
(b) If directors have not been selected or
before the organizational meeting, by an incorporator; or
(c) If the corporation is in the hands of
a receiver, trustee or other court-appointed fiduciary, by that fiduciary,
receiver or trustee.
(7) The person executing the document
shall state beneath or opposite the signature the name of the person and the
capacity in which the person signs. The document may, but is not required to
contain:
(a) The corporate seal;
(b) An attestation by the secretary or an
assistant secretary; or
(c) An acknowledgment, verification or
proof.
(8) If the Secretary of State has
prescribed a mandatory form for the document under ORS 60.016, the document
must be in or on the prescribed form.
(9) The document must be delivered to the
Office of the Secretary of State and must be accompanied by the required fees.
(10) Delivery of a document to the office
is accomplished only when the document is actually received by the office. [1987
c.52 §4; 1989 c.1040 §3; 1999 c.486 §5]
60.007
Filing, service, copying and certification fees. The Secretary of State shall collect the
fees described in ORS 56.140 for each document delivered for filing under this
chapter and for process served on the secretary under this chapter. The
secretary may collect the fees described in ORS 56.140 for copying any public
record under this chapter, certifying the copy or certifying to other facts of
record under this chapter. [1987
c.52 §6; 1989 c.383 §3; 1989 c.1040 §36; 1991 c.132 §3; 1999 c.362 §§4,4a]
60.010 [Repealed by 1953 c.549 §138]
60.011
Effective time and date of document. (1) Except as provided in subsection (2) of this section and ORS
60.014 (3), a document accepted for filing is effective on the date it is filed
by the Secretary of State and at the time, if any, specified in the document as
its effective time or at 12:01 a.m. on that date if no effective time is
specified.
(2) If a document specifies a delayed
effective time and date, the document becomes effective at the time and date
specified. If a document specifies a delayed effective date but no time, the
document becomes effective at 12:01 a.m. on that date. A delayed effective date
for a document may not be later than the 90th day after the date it is filed. [1987
c.52 §7; 1989 c.1040 §4]
60.014
Correcting filed document.
(1) A domestic or foreign corporation may correct a document filed by the
Secretary of State, other than an annual report, if the document contains an
incorrect statement or was defectively executed, attested, sealed, verified or
acknowledged.
(2) A domestic or foreign corporation
shall correct a document by delivering articles of correction to the office.
The articles shall include the following:
(a) A description of the document,
including its filing date, or a copy of the document.
(b) The incorrect statement and the reason
it is incorrect, or a description of the manner in which the execution,
attestation, seal, verification or acknowledgment is defective.
(c) A correction of the incorrect
statement or defective execution, attestation, seal, verification or
acknowledgment.
(3) Articles of correction are effective
on the effective date of the document they correct except as to persons relying
on the uncorrected document and adversely affected by the correction. As to
those persons, articles of correction are effective when filed. [1987 c.52 §8]
60.016
Forms; rules. Upon request,
the Secretary of State may furnish forms for documents required or permitted to
be filed by this chapter. The Secretary of State may by rule require the use of
the forms. [1987 c.52 §5; 1995 c.215 §6]
60.017
Filing duty of Secretary of State. (1) If a document delivered to the Office of the Secretary of State
for filing satisfies the requirements of ORS 60.004, the Secretary of State
shall file it.
(2) The Secretary of State files a
document by indicating thereon that it has been filed by the Secretary of State
and the date of filing. After filing a document, except as provided in ORS
60.114, 60.117, 60.671, 60.674, 60.724, 60.727 and 60.787, the Secretary of
State shall return an acknowledgment of filing to the domestic or foreign
corporation or its representative.
(3) If the Secretary of State refuses to
file a document, the Secretary of State shall return it to the domestic or
foreign corporation or its representative within 10 business days after the
document was delivered together with a brief written explanation of the reason
for the refusal.
(4) The Secretary of States duty to file
documents under this section is ministerial. The Secretary of State is not
required to verify or inquire into the legality or truth of any matter included
in any document delivered to the office for filing. The Secretary of States
filing or refusing to file a document does not:
(a) Affect the validity or invalidity of
the document in whole or part; or
(b) Relate to the correctness or
incorrectness of information contained in the document.
(5) The Secretary of States refusal to
file a document does not create a presumption that the document is invalid or
that information contained in the document is incorrect. [1987 c.52 §9; 1989
c.1040 §5; 1999 c.486 §6]
60.020 [Repealed by 1953 c.549 §138]
60.021
Appeal from Secretary of States refusal to file document. If the Secretary of State refuses to file a
document delivered to the office for filing, the domestic or foreign
corporation, in addition to any other legal remedy which may be available,
shall have the right to appeal from such order pursuant to the provisions of
ORS chapter 183. [1987 c.52 §10]
60.024
Evidentiary effect of copy of filed document. (1) A certificate attached to a copy of a document filed by the
Secretary of State, bearing the Secretary of States signature, which may be in
facsimile, is conclusive evidence that the original document or a facsimile
thereof, is on file with the office.
(2) The provisions of ORS 56.110 shall
apply to all documents filed pursuant to this chapter. [1987 c.52 §11]
60.027
Certificate of existence or authorization. (1) Anyone may apply to the Secretary of State to furnish a
certificate of existence for a domestic corporation or a certificate of
authorization for a foreign corporation.
(2) A certificate of existence or
authorization when issued means that:
(a) The domestic corporations corporate
name or the foreign corporations corporate name is registered in this state;
(b) The domestic corporation is duly
incorporated under the law of this state or the foreign corporation is
authorized to transact business in this state;
(c) All fees payable to the Secretary of
State under this chapter have been paid, if nonpayment affects the existence or
authorization of the domestic or foreign corporation;
(d) An annual report required by ORS
60.787 has been filed by the Secretary of State within the preceding 14 months;
and
(e) Articles of dissolution or an
application for withdrawal have not been filed by the Secretary of State.
(3) A person may apply to the Secretary of
State to issue a certificate covering any fact of record.
(4) Subject to any qualification stated in
the certificate, a certificate of existence or authorization issued by the
Secretary of State may be relied upon as conclusive evidence that the domestic
or foreign corporation is in existence or is authorized to transact business in
this state. [1987 c.52 §12]
60.030 [Repealed by 1953 c.549 §138]
(Secretary of
State)
60.031
Powers. The Secretary of
State has the power reasonably necessary to perform the duties required of the
Secretary of State by this chapter. [1987 c.52 §13]
(Notice)
60.034
Notice. (1) Except as
provided in subsection (3) of this section, notice under this chapter shall be
in writing unless oral notice is specifically permitted under the circumstances
by the articles of incorporation or bylaws. Notice by electronic transmission,
other than voice mail, is written notice.
(2)(a) Notice may be communicated in
person, by mail or other method of delivery, by telephone or by voice mail or
other electronic transmission.
(b) If a form of notice described in
paragraph (a) of this subsection is impracticable, notice may be communicated
by a newspaper of general circulation in the area where published, or by radio,
television or other form of public broadcast communication.
(3) All notices required by this chapter
by a corporation to its shareholders shall be in writing. Written notice by a
domestic or foreign corporation to a shareholder or director, if in a
comprehensible form, is effective:
(a) Upon deposit in the United States mail
if it is mailed postpaid and is correctly addressed to the shareholders
address shown in the corporations current record of shareholders or the
directors address shown in the corporations records;
(b) When electronically transmitted to the
shareholder in a manner authorized in writing by the shareholder; or
(c) When electronically transmitted to the
director in a manner authorized by the director.
(4) Written notice to a domestic or foreign
corporation authorized to transact business in this state may be addressed to
its registered agent at its registered office or to the domestic or foreign
corporation or its president or secretary at its principal office or mailing
address as shown in the records of the office.
(5) Except as provided in subsection (3)
of this section, or unless the articles of incorporation or bylaws provide
otherwise for notices to directors, written notice, if in a comprehensible
form, is effective at the earliest of the following:
(a) When received;
(b) Five days after its deposit in the
United States mail, as evidenced by the postmark, if mailed postpaid and
correctly addressed; or
(c) On the date shown on the return
receipt, if sent by registered or certified mail, return receipt requested and
the receipt is signed by or on behalf of the addressee.
(6) Oral notice is effective when
communicated if communicated in a comprehensible manner.
(7) If this chapter prescribes notice
requirements for particular circumstances, those requirements govern. If
articles of incorporation or bylaws prescribe notice requirements, not
inconsistent with this section or other provisions of this chapter, those
requirements govern. [1987 c.52 §14; 1989 c.1040 §6; 2003 c.80 §2]
60.040 [Repealed by 1953 c.549 §138]
INCORPORATION
60.044
Incorporators. One or more
individuals 18 years of age or older, a domestic or foreign corporation, a
partnership or an association may act as incorporators of a corporation by
delivering articles of incorporation to the office for filing. [1987 c.52 §15]
60.047
Articles of incorporation.
(1) The articles of incorporation shall set forth:
(a) A corporate name for the corporation
that satisfies the requirements of ORS 60.094;
(b) The number of shares the corporation
is authorized to issue;
(c) The address, including street and
number, and mailing address, if different, of the corporations initial
registered office and the name of its initial registered agent at that office;
(d) The name and address of each
incorporator; and
(e) A mailing address to which notices, as
required by this chapter, may be mailed until an address has been designated by
the corporation in its annual report.
(2) The articles of incorporation may set
forth:
(a) The names of the initial directors;
(b) The addresses of the initial
directors;
(c) Provisions regarding:
(A) The purpose or purposes for which the
corporation is organized;
(B) Managing the business and regulating
the affairs of the corporation;
(C) Defining, limiting and regulating the
powers of the corporation, its board of directors and shareholders; and
(D) A par value for authorized shares or
classes of shares;
(d) A provision eliminating or limiting
the personal liability of a director to the corporation or its shareholders for
monetary damages for conduct as a director, provided that no such provision
shall eliminate or limit the liability of a director for any act or omission
occurring prior to the date when such provision becomes effective and such provision
shall not eliminate or limit the liability of a director for:
(A) Any breach of the directors duty of
loyalty to the corporation or its shareholders;
(B) Acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law;
(C) Any unlawful distribution under ORS
60.367; or
(D) Any transaction from which the
director derived an improper personal benefit;
(e) A provision authorizing or directing
the corporation to conduct the business of the corporation in a manner that is
environmentally and socially responsible; and
(f) Any provision that under this chapter
is required or permitted to be set forth in the bylaws.
(3) The articles of incorporation need not
set forth any of the corporate powers enumerated in this chapter. [1987 c.52 §16;
1989 c.1040 §7; 1991 c.883 §1; 2007 c.254 §1]
60.050 [Repealed by 1953 c.549 §138]
60.051
Incorporation. (1) Unless a
delayed effective date is specified, the corporate existence begins when the
articles of incorporation are filed by the Secretary of State.
(2) The Secretary of States filing of the
articles of incorporation is conclusive proof that the incorporators satisfied
all conditions precedent to incorporation except in a proceeding by the state
to cancel or revoke the incorporation or involuntarily dissolve the
corporation. [1987 c.52 §17]
60.054
Liability for preincorporation transactions. All persons purporting to act as or on behalf of a corporation,
knowing there was no incorporation, are jointly and severally liable for all
liabilities created while so acting. [1987 c.52 §18]
60.057
Organization of corporation.
(1) After incorporation, if initial directors are named in the articles of
incorporation, the initial directors shall hold an organizational meeting at
the call of a majority of the directors to complete the organization of the
corporation by appointing officers, adopting bylaws and carrying on any other
business brought before the meeting.
(2) After incorporation, if initial
directors are not named in the articles, the incorporator or incorporators
shall hold an organizational meeting at the call of a majority of the
incorporators to elect directors and complete the organization of the
corporation or to elect a board of directors who shall complete the
organization of the corporation.
(3) Action required or permitted by this
chapter to be taken by incorporators at an organizational meeting may be taken
without a meeting if the action taken is evidenced by one or more written
consents describing the action taken and signed by each incorporator.
(4) An organizational meeting may be held
in or out of this state. [1987 c.52 §19]
60.060 [Repealed by 1953 c.549 §138]
60.061
Bylaws. (1) The
incorporators or board of directors of a corporation shall adopt initial bylaws
for the corporation.
(2) The bylaws of a corporation may
contain any provision for managing the business and regulating the affairs of
the corporation that is not inconsistent with law or the articles of
incorporation. [1987 c.52 §20]
60.064
Emergency bylaws. (1) Unless
the articles of incorporation provide otherwise, the board of directors of a
corporation may adopt bylaws to be effective only in an emergency defined in
subsection (4) of this section. The emergency bylaws, which are subject to
amendment or repeal by the shareholders, may contain all provisions necessary
for managing the corporation during the emergency, including:
(a) Procedures for calling a meeting of
the board of directors;
(b) Quorum requirements for the meeting;
and
(c) Designation of additional or
substitute directors.
(2) All provisions of the regular bylaws
consistent with the emergency bylaws remain effective during the emergency. The
emergency bylaws are not effective after the emergency ends.
(3) Corporate action taken in good faith
in accordance with the emergency bylaws binds the corporation and may not be
used to impose liability on a corporate director, officer, employee or agent.
(4) An emergency exists for purposes of
this section if a quorum of the corporations directors cannot readily be
assembled because of some catastrophic event. [1987 c.52 §21]
60.070 [Repealed by 1953 c.549 §138]
PURPOSES AND
POWERS
60.074
Purposes. (1) Every
corporation incorporated under this chapter has the purpose of engaging in any
lawful business unless a more limited purpose is set forth in the articles of
incorporation.
(2) A business that is subject to
regulation under another statute of this state may not be incorporated under
this chapter if such business is required to be organized under such other
statute. [1987 c.52 §22; 1989 c.1040 §8]
60.077
General powers. (1) Unless
its articles of incorporation provide otherwise, every corporation has
perpetual duration and succession in its corporate name.
(2) Unless its articles of incorporation
provide otherwise, every corporation has the same powers as an individual to do
all things necessary or convenient to carry out its business and affairs,
including without limitation, power to:
(a) Sue and be sued and complain and
defend in its corporate name;
(b) Have a corporate seal, which may be
altered at will, and use it or a facsimile thereof, by impressing, affixing or
reproducing it in any other manner;
(c) Make and amend bylaws, not
inconsistent with its articles of incorporation or with the laws of this state
for managing the business and regulating the affairs of the corporation;
(d) Purchase, receive, lease or otherwise
acquire, and own, hold, improve, use and otherwise deal with real or personal
property, or any interest in property, wherever located;
(e) Sell, convey, mortgage, pledge, lease,
exchange and otherwise dispose of all or any part of its property;
(f) Purchase, receive, subscribe for,
acquire, own, hold, vote, use, sell, mortgage, lend, pledge or otherwise
dispose of and deal in and with shares or other interests in, or obligations
of, any other entity;
(g) Make contracts and guarantees, incur
liabilities, borrow money, issue its notes, bonds and other obligations that
may be convertible into other securities of the corporation or include the
option to purchase other securities of the corporation and secure any of its
obligations by mortgage or pledge of any of its property, franchises or income;
(h) Lend money, invest and reinvest
corporate funds and receive and hold real and personal property as security for
repayment;
(i) Be a promoter, partner, member,
associate or manager of any partnership, joint venture, trust or other entity;
(j) Conduct its business, locate offices
and exercise the powers granted by this chapter within or without this state;
(k) Elect directors and appoint officers,
employees and agents of the corporation;
(L) Define directors, officers,
employees and agents duties, fix their compensation and lend them money and
credit;
(m) Pay pensions and establish pension
plans, share option plans and benefit or incentive plans for any or all of its
current or former directors, officers, employees and agents;
(n) Make donations for the public welfare
or for charitable, scientific or educational purposes;
(o) Transact any lawful business that will
aid governmental policy; and
(p) Make payment or donations or do any
other act, not inconsistent with law, that furthers the business and affairs of
the corporation. [1987 c.52 §23]
60.080 [Repealed by 1953 c.549 §138]
60.081
Emergency powers. (1) In
anticipation of or during an emergency defined in subsection (4) of this
section, the board of directors of a corporation may:
(a) Modify lines of succession to
accommodate the incapacity of any director, officer, employee or agent; and
(b) Relocate the principal office,
designate alternative principal offices or regional offices or authorize the
officers to do so.
(2) During an emergency defined in
subsection (4) of this section, unless emergency bylaws provide otherwise:
(a) Notice of a meeting of the board of
directors need be given only to those directors whom it is practicable to reach
and may be given in any practicable manner, including by publication and radio.
(b) One or more officers of the
corporation present at a meeting of the board of directors may be deemed to be
directors for the meeting, in order of the officers rank and within the same
rank in order of seniority, as necessary to achieve a quorum.
(3) Corporate action taken in good faith
during an emergency under this section to further the ordinary business affairs
of the corporation:
(a) Binds the corporation; and
(b) May not be used to impose liability on
a corporate director, officer, employee or agent.
(4) An emergency exists for purposes of
this section if a quorum of the corporations directors cannot readily be
assembled because of some catastrophic event. [1987 c.52 §24]
60.084
Validity of corporate acts.
(1) Except as provided in subsection (2) of this section, the validity of
corporate action may not be challenged on the ground that the corporation lacks
or lacked power to act.
(2) A corporations power to act may be
challenged:
(a) In a proceeding by a shareholder
against the corporation to enjoin the act;
(b) In a proceeding by the corporation,
directly, derivatively, or through a receiver, trustee or other legal
representative against an incumbent or former director, officer, employee or
agent of the corporation; or
(c) In a proceeding by the Attorney
General under ORS 60.661.
(3) In a shareholders proceeding under
subsection (2)(a) of this section to enjoin an unauthorized corporate act, the
court may enjoin or set aside the act, if equitable and if all affected persons
are parties to the proceeding, and may award damages for loss other than
anticipated profits suffered by the corporation or another party because of
enjoining the unauthorized act. [1987 c.52 §25]
60.090 [Repealed by 1953 c.549 §138]
NAME
60.094
Corporate name. (1) A
corporate name shall contain one or more of the words corporation, incorporated,
company or limited or an abbreviation of one or more of those words.
(2) A corporate name shall not contain the
word cooperative.
(3) A corporate name shall be written in the
alphabet used to write the English language and may include Arabic and Roman
numerals and incidental punctuation.
(4) A corporate name shall be
distinguishable upon the records of the office from any other corporate name,
professional corporate name, nonprofit corporate name, cooperative name,
limited partnership name, business trust name, reserved name, registered
corporate name or assumed business name of active record with the office.
(5) The corporate name need not satisfy
the requirement of subsection (4) of this section if the applicant delivers to
the office a certified copy of a final judgment of a court of competent
jurisdiction that finds that the applicant has a prior or concurrent right to
use the corporate name in this state.
(6) The provisions of this section do not
prohibit a corporation from transacting business under an assumed business
name.
(7) The provisions of this section do not:
(a) Abrogate or limit the law governing
unfair competition or unfair trade practices; or
(b) Derogate from the common law, the
principles of equity or the statutes of this state or of the
60.097
Reserved name. (1) A person
may apply to the office to reserve a corporate name. The application must set
forth the name and address of the applicant and the name proposed to be
reserved.
(2) If the Secretary of State finds that
the corporate name applied for conforms to ORS 60.094, the Secretary of State
shall reserve the name for the applicant for a 120-day period.
(3) A person may transfer the reservation
of a corporate name to another person by delivering to the office a notice of
the transfer executed by the person for whom the name was reserved and
specifying the name and address of the transferee. [1987 c.52 §27]
60.100 [Amended by 1953 c.549 §138; renumbered
57.815]
60.101
Registered name. (1) A
foreign corporation may apply to the office to register its corporate name.
(2) The application must set forth the corporate
name, the state or country of its incorporation, the date of its incorporation
and a brief description of the nature of the business in which it is engaged
and a statement that it is not carrying on or doing business in the State of
Oregon. The application must be accompanied by a certificate of existence or a
document of similar import current within 60 days of delivery, duly
authenticated by the official having custody of corporate records in the state
or country under whose law it is incorporated.
(3) If the Secretary of State finds that
the name conforms to ORS 60.094 the Secretary of State shall register the name
effective for one year. [1987 c.52 §28]
60.110 [Repealed by 1953 c.549 §138]
OFFICE AND
AGENT
60.111
Registered office and registered agent. (1) Each corporation shall continuously maintain in this state a
registered agent and registered office that may be, but need not be, the same
as any of its places of business.
(2) A registered agent shall be:
(a) An individual who resides in this
state and whose business office is identical to the registered office;
(b) A domestic corporation, domestic
limited liability company, domestic professional corporation or domestic
nonprofit corporation whose business office is identical to the registered
office; or
(c) A foreign corporation, foreign limited
liability company, foreign professional corporation or foreign nonprofit
corporation authorized to transact business in this state whose business office
is identical to the registered office. [1987 c.52 §29; 2001 c.315 §24]
60.114
Change of registered office or registered agent. (1) A corporation may change its registered
office or registered agent by delivering to the office of the Secretary of
State for filing a statement of change that sets forth:
(a) The name of the corporation;
(b) If the registered office is to be
changed, the address including street and number of the new registered office;
(c) If the registered agent is to be
changed, the name of the new registered agent and that the new agent has
consented to the appointment; and
(d) That after the change or changes are
made the street addresses of its registered office and the business office of
its registered agent will be identical.
(2) If a registered agent changes the
street address of the agents business office, the registered agent shall
change the street address of the registered office of the corporation for which
the agent is the registered agent by notifying the corporation in writing of
the change and signing, either manually or in facsimile, and delivering to the
office of the Secretary of State a statement that complies with the
requirements of subsection (1) of this section and recites that the corporation
has been notified of the change.
(3) The filing of the statement by the
Secretary of State shall terminate the existing registered office or agent, or
both, on the effective date of the filing and establish the newly appointed
registered office or agent, or both, as that of the corporation. [1987 c.52 §30]
60.117
Resignation of registered agent. (1) A registered agent may resign as agent upon delivering a signed
statement to the office and giving notice in the form of a copy of the
statement to the corporation. The statement may include a statement that the
registered office is also discontinued.
(2) Upon delivery of the signed statement,
the Secretary of State shall file the resignation statement. The copy of the
statement given to the corporation under subsection (1) of this section shall
be addressed to the corporation at the corporations mailing address or the
corporations principal office as shown by the records of the office of the
Secretary of State.
(3) The agency appointment is terminated
and the registered office discontinued, if so provided, on the 31st day after
the date on which the statement was filed by the Secretary of State, unless the
corporation shall sooner appoint a successor registered agent as provided in
ORS 60.114, thereby terminating the capacity of such agent. [1987 c.52 §31;
1993 c.190 §1]
60.120 [Repealed by 1953 c.549 §138]
60.121
Service on corporation. (1)
The registered agent appointed by a corporation shall be an agent of the
corporation upon whom any process, notice or demand required or permitted by
law to be served upon the corporation may be served.
(2) The Secretary of State shall be an
agent of a corporation including a dissolved corporation upon whom any such
process, notice or demand may be served whenever the corporation fails to
appoint or maintain a registered agent in this state or whenever the
corporations registered agent cannot with reasonable diligence be found at the
registered office.
(3) Service shall be made on the Secretary
of State by:
(a) Serving the Secretary of State or a
clerk on duty at the office a copy of the process, notice or demand, with any
papers required by law to be delivered in connection with the service, and the
required fee for each party being served or by mailing to the office a copy of
the process, notice or demand and the required fee for each party being served
by certified or registered mail;
(b) Transmittal by the person instituting
the proceedings of notice of the service on the Secretary of State and copy of
the process, notice or demand and accompanying papers to the corporation being
served by certified or registered mail:
(A) At the last registered office of the
corporation as shown by the records on file in the office of the Secretary of
State; and
(B) At such address the use of which the
person initiating the proceedings knows or, on the basis of reasonable inquiry,
has reason to believe is most likely to result in actual notice; and
(c) Filing with the appropriate court or
other body, as part of the return of service, the return receipt of mailing and
an affidavit of the person initiating the proceedings stating that this section
has been complied with.
(4) The Secretary of State shall keep a
record of all processes, notices and demands served upon the Secretary of State
under this section.
(5) After completion of initial service
upon the Secretary of State, no additional documents need be served upon the
Secretary of State to maintain jurisdiction in the same proceeding or to give
notice of any motion or provisional process.
(6) Nothing contained in this section
shall limit or affect the right to serve any process, notice or demand required
or permitted by law to be served upon a corporation in any other manner now or
hereafter permitted by law, or enlarge the purposes for which service on the
Secretary of State is permitted where such purposes are limited by other
provisions of law. [1987 c.52 §32; 2007 c.71 §16]
60.130 [Repealed by 1953 c.549 §138]
SHARES AND
DISTRIBUTIONS
(Shares)
60.131
Authorized shares. (1) The
articles of incorporation must prescribe the classes of shares and the number
of shares of each class that the corporation is authorized to issue. If more
than one class of shares is authorized, the articles of incorporation must
prescribe a distinguishing designation for each class, and prior to the issuance
of shares of a class, the preferences, limitations and relative rights of that
class must be described in the articles of incorporation. All shares of a class
must have preferences, limitations and relative rights identical to those of
other shares of the same class except to the extent otherwise permitted by ORS
60.134 and 60.157.
(2) If the articles of incorporation
authorize only one class of shares, that class has unlimited voting rights and
rights to receive the net assets of the corporation upon dissolution. If the
articles of incorporation authorize more than one class of shares, then one or
more classes of shares must together have unlimited voting rights, and one or
more classes of shares which may be the same class or classes as those with
voting rights, must together be entitled to receive the net assets of the
corporation upon dissolution.
(3) The articles of incorporation may
authorize one or more classes of shares that:
(a) Have special, conditional or limited
voting rights, or no voting rights, except to the extent prohibited by this
chapter;
(b) Are redeemable or convertible as
specified in the articles of incorporation:
(A) At the option of the corporation, the
shareholder or another person or upon the occurrence of a designated event;
(B) For cash, indebtedness, securities or
other property; or
(C) In a designated amount or in an amount
determined in accordance with a designated formula or by reference to extrinsic
data or events;
(c) Entitle the holders to distributions
calculated in any manner, including dividends that may be cumulative,
noncumulative or partially cumulative; or
(d) Have preference over any other class
of shares with respect to distributions, including dividends and distributions
upon the dissolution of the corporation.
(4) The description of the designations,
preferences, limitations and relative rights of share classes in subsection (3)
of this section is not exhaustive. [1987 c.52 §33; 1989 c.4 §9; 1989 c.1040 §9]
60.134
Terms of class or series determined by board of directors. (1) If the articles of incorporation so
provide, the board of directors may determine, in whole or part, the
preferences, limitations and relative rights, subject to the requirements of
ORS 60.131, of any class of shares before the issuance of any shares of that
class or one or more series within a class before the issuance of any shares of
that series.
(2) Each series of a class must be given a
distinguishing designation.
(3) All shares of a series must have
preferences, limitations and relative rights identical with those of other
shares of the same series and, except to the extent otherwise provided in the
description of the series, of those of other series of the same class.
(4) Before issuing any shares of a class
or series created under this section, the corporation must deliver to the
office for filing, articles of amendment which are effective without
shareholder action, that set forth:
(a) The name of the corporation;
(b) The text of the amendment determining
the terms of the class or series of shares;
(c) The date it was adopted; and
(d) A statement that the amendment was
duly adopted by the board of directors. [1987 c.52 §34; 1989 c.1040 §10]
60.137
Issued and outstanding shares.
(1) A corporation may issue the number of shares of each class or series
authorized by the articles of incorporation. Shares that are issued are
outstanding shares until they are reacquired, redeemed, converted or canceled.
(2) The reacquisition, redemption or
conversion of outstanding shares is subject to the limitations of subsection
(3) of this section and ORS 60.177 and 60.181.
(3) At all times that shares of the
corporation are outstanding, one or more shares that together have unlimited
voting rights and one or more shares that together are entitled to receive the
net assets of the corporation upon dissolution must be outstanding. [1987 c.52 §35]
60.140 [Repealed by 1953 c.549 §138]
60.141
Fractional shares. (1) A
corporation may:
(a) Issue fractions of a share or pay in
money the value of fractions of a share;
(b) Arrange for disposition of fractional
shares by the shareholders; and
(c) Issue scrip in registered or bearer
form entitling the holder to receive a full share upon surrendering enough
scrip to equal a full share.
(2) Each certificate representing scrip
must be conspicuously labeled scrip and must contain the information required
by ORS 60.161 (2).
(3) The holder of a fractional share is
entitled to exercise the rights of a shareholder, including the right to vote,
receive dividends and participate in the assets of the corporation upon
liquidation. The holder of scrip is not entitled to any of these rights unless
the scrip provides for them.
(4) The board of directors may authorize
the issuance of scrip subject to any condition considered desirable, including:
(a) That the scrip will become void if not
exchanged for full shares before a specified date; and
(b) That the shares for which the scrip is
exchangeable may be sold and the proceeds paid to the scripholders. [1987 c.52 §36]
(Issuance of
Shares)
60.144
Subscription for shares before incorporation. (1) A subscription for shares entered into before incorporation is
irrevocable for six months unless the subscription agreement provides a longer
or shorter period or all the subscribers agree to revocation.
(2) The board of directors may determine
the payment term of subscriptions for shares that were entered into before
incorporation unless the subscription agreement specifies them. A call for
payment by the board of directors must be uniform so far as practicable as to
all shares of the same class or series, unless the subscription agreement
specifies otherwise.
(3) Shares issued pursuant to
subscriptions entered into before incorporation are fully paid and nonassessable
when the corporation receives the consideration specified in the subscription
agreement.
(4) If a subscriber defaults in payment of
money or property under a subscription agreement entered into before
incorporation, the corporation may collect the amount owed as any other debt.
Alternatively, unless the subscription agreement provides otherwise, the
corporation may rescind the agreement if the debt remains unpaid more than 20
days after the corporation sends written demand for payment to the subscriber.
(5) A subscription agreement entered into
after incorporation is a contract between the subscriber and the corporation
subject to ORS 60.147. [1987 c.52 §37]
60.147
Issuance of shares. (1) The
powers granted in this section to the board of directors may be reserved to the
shareholders by the articles of incorporation.
(2) The board of directors may authorize
shares to be issued for consideration consisting of any tangible or intangible
property or benefit to the corporation, including cash, promissory notes,
services performed, contracts for services to be performed or other securities
of the corporation.
(3) Before the corporation issues shares,
the board of directors must determine that the consideration received or to be
received for shares to be issued is adequate. That determination by the board
of directors is conclusive insofar as the adequacy of consideration for the
issuance of shares relates to whether the shares are validly issued, fully paid
and nonassessable. A record of action by the board of directors authorizing the
issuance of shares for a specified consideration may be relied upon in
concluding that shares are validly issued, fully paid and nonassessable.
(4) When the corporation receives the
consideration for which the board of directors authorized the issuance of
shares, the shares issued therefor are fully paid and nonassessable.
(5) The corporation may place in escrow
shares issued for a contract for future services or benefits or a promissory
note or make other arrangements to restrict the transfer of shares, and may
credit distributions in respect of the shares against their purchase price,
until the services are performed, the note is paid or the benefits received. If
the services are not performed, the note is not paid or the benefits are not
received, the shares placed in escrow or restricted and the distributions
credited may be canceled in whole or in part. [1987 c.52 §38; 1989 c.1040 §11]
60.150 [Repealed by 1953 c.549 §138]
60.151
Liability of shareholders.
(1) A purchaser from a corporation of its own shares is not liable to the
corporation or its creditors with respect to the shares except to pay the
consideration for which the shares were authorized to be issued or specified in
the subscription agreement.
(2) A shareholder of a corporation is not
personally liable for the acts or debts of the corporation merely by reason of
being a shareholder. [1987 c.52 §39]
60.154
Share dividends. (1) Unless
the articles of incorporation provide otherwise, shares may be issued pro rata
and without consideration to the corporations shareholders or to the
shareholders of one or more classes or series. An issuance of shares under this
subsection is a share dividend.
(2) Shares of one class or series may not
be issued as a share dividend in respect to shares of another class or series
unless the articles of incorporation so authorize, a majority of the votes
entitled to be cast by the class or series to be issued approve the issue or
there are no outstanding shares of the class or series to be issued.
(3) If the board of directors does not fix
the record date for determining shareholders entitled to a share dividend, the
record date is the date the board of directors authorizes the share dividend.
(4) For purposes of this section, a share
dividend shall include a share split, other than a reverse share split. [1987
c.52 §40; 1989 c.1040 §12]
60.157
Share rights, options and warrants. (1) A corporation may issue rights, options or warrants for the
purchase of shares of the corporation. The board of directors shall determine
the terms upon which the rights, options or warrants are issued. The board
shall also determine their form and content and the consideration for which the
shares are to be issued.
(2) Rights, options or warrants issued to
the holders of all shares of any class shall not be considered to conflict with
the provisions of ORS 60.131 (1) if the terms and conditions of the rights,
options or warrants include restrictions or conditions that:
(a) Preclude or limit the exercise,
transfer or receipt of rights, options or warrants by any person owning or
offering to acquire a specified number or percentage of the outstanding stock
or other securities of the corporation or any transferee of any such person; or
(b) Invalidate or void the rights, options
or warrants held by any such person or any transferee. [1987 c.52 §41; 1989 c.4
§10]
60.160 [Repealed by 1953 c.549 §138]
60.161
Form and content of certificates. (1) Shares may be but are not required to be represented by
certificates. Unless this chapter or another statute expressly provides
otherwise, the rights and obligations of shareholders are identical whether or
not their shares are represented by certificates.
(2) At a minimum, each share certificate
shall state on its face:
(a) The name of the issuing corporation
and that it is organized under the law of this state;
(b) The name of the person to whom the
share is issued; and
(c) The number and class of shares and the
designation of the series, if any, the certificate represents.
(3) If the issuing corporation is
authorized to issue different classes of shares or different series within a
class, the designations, relative rights, preferences and limitations
applicable to each class, the variations in rights, preferences and limitations
determined for each series and the authority of the board of directors to
determine variations for future series shall be summarized on the front or back
of each certificate or, each certificate may state conspicuously on its front
or back that the corporation will furnish the shareholder with this information
on request in writing and without charge.
(4) Each share certificate must be signed,
either manually or in facsimile, by two officers designated in the bylaws or by
the board of directors. Each certificate may bear the corporate seal or its
facsimile.
(5) If the person who signed a share
certificate, either manually or in facsimile, no longer holds office when the
certificate is issued, the certificate is nevertheless valid. [1987 c.52 §42]
60.164
Shares without certificates.
(1) Unless the articles of incorporation or bylaws provide otherwise, the board
of directors of a corporation may authorize the issue of some or all of the
shares of any or all of its classes or series without certificates. The
authorization does not affect shares already represented by certificates until
they are surrendered to the corporation.
(2) Within a reasonable time after the
issue or transfer of shares without certificates, the corporation shall send
the shareholder a written statement of the information required on certificates
by ORS 60.161 (2) and (3), and if applicable, ORS 60.167. [1987 c.52 §43]
60.167
Restriction on transfer of shares and other securities. (1) The articles of incorporation, bylaws,
agreements among shareholders or agreements between shareholders and the
corporation may impose restrictions on the transfer or registration of transfer
of shares of the corporation. A restriction does not affect shares issued
before the restriction was adopted unless the holders of the shares are parties
to the restriction agreement or voted in favor of the restriction.
(2) A restriction on the transfer or
registration of transfer of shares is valid and enforceable against the holder or
a transferee of the holder if the restriction is authorized by this section and
its existence is noted conspicuously on the front or back of the certificate or
is contained in the information statement required by ORS 60.164 (2). Unless so
noted, a restriction is not enforceable against a person who has no knowledge
of the restriction.
(3) A restriction on the transfer or
registration of transfer of shares is authorized:
(a) To maintain the corporations status
when it is dependent on the number or identity of its shareholders;
(b) To preserve exemptions under federal
or state securities law; or
(c) For any other reasonable purpose.
(4) A restriction on the transfer or
registration of transfer of shares may:
(a) Obligate the shareholder first to offer
the corporation or other persons, separately, consecutively or simultaneously
an opportunity to acquire the restricted shares;
(b) Obligate the corporation or other
persons, separately, consecutively or simultaneously to acquire the restricted
shares;
(c) Require the corporation, the holders
of any class of its shares or another person to approve the transfer of the
restricted shares if the requirement is not manifestly unreasonable; or
(d) Prohibit the transfer of the
restricted shares to designated persons or classes of persons, if the
prohibition is not manifestly unreasonable.
(5) For purposes of this section, shares
includes a security convertible into or carrying a right to subscribe for or
acquire shares. [1987 c.52 §44]
60.170 [Repealed by 1953 c.549 §138]
60.171
Expense of issue. A
corporation may pay the expenses of selling or underwriting its shares and
organizing or reorganizing the corporation from the consideration received for
shares. [1987 c.52 §45]
(Subsequent
Acquisition of Shares by Shareholders and Corporation)
60.174
Preemptive rights of shareholders. (1) Except to the extent limited or denied by this section or by the
articles of incorporation, the shareholders of a corporation incorporated prior
to June 15, 1987, shall have preemptive rights as defined in this section. By
articles of amendment or restated articles filed after such date, a corporation
may eliminate preemptive rights under this subsection by including in the
articles of amendment or restated articles that the corporation elects to
waive preemptive rights, or words of similar import, in which event this
subsection shall no longer apply to the corporation.
(2) Except as provided in subsection (1)
of this section, the shareholders of a corporation do not have a preemptive
right to acquire the corporations unissued shares except to the extent the
articles of incorporation so provide.
(3) A statement included in the articles
of incorporation that the corporation elects to have preemptive rights, or
words of similar import, means that the following principles apply except to
the extent the articles of incorporation expressly provide otherwise:
(a) The shareholders of the corporation
have a preemptive right, granted on uniform terms and conditions prescribed by
the board of directors to provide a fair and reasonable opportunity to exercise
the right to acquire proportional amounts of the corporations unissued shares
upon the decision of the board of directors to issue them.
(b) A shareholder may waive the shareholders
preemptive right. A waiver evidenced by a writing is irrevocable even though it
is not supported by consideration.
(c) There is no preemptive right with
respect to:
(A) Shares issued as compensation to
directors, officers, agents or employees of the corporation, its subsidiaries
or affiliates;
(B) Shares issued to satisfy conversion or
option rights created to provide compensation to directors, officers, agents or
employees of the corporation, its subsidiaries or affiliates;
(C) Shares authorized in articles of
incorporation that are issued within six months from the effective date of
incorporation; or
(D) Shares sold other than for money.
(d) Holders of shares of any class without
general voting rights but with preferential rights to distributions or assets
have no preemptive rights with respect to shares of any class.
(e) Holders of shares of any class with
general voting rights but without preferential rights to distributions or
assets have no preemptive rights with respect to shares of any class with
preferential rights to distributions or assets unless the shares with
preferential rights are convertible into or carry a right to subscribe for or
acquire shares without preferential rights.
(f) Shares subject to preemptive rights
that are not acquired by shareholders may be issued to any person for a period
of one year after being offered to shareholders at a consideration set by the
board of directors that is not lower than the consideration set for the
exercise of preemptive rights. An offer at a lower consideration or after the
expiration of one year is subject to the shareholders preemptive rights.
(4) For purposes of this section, shares
includes a security convertible into or carrying a right to subscribe for or
acquire shares. [1987 c.52 §46; 1987 c.579 §3; 1991 c.883 §2]
60.177
Corporations acquisition of its own shares. (1) A corporation may acquire its own shares and shares so acquired
constitute authorized but unissued shares.
(2) If the articles of incorporation
prohibit the reissue of acquired shares, the number of authorized shares is
reduced by the number of shares acquired, effective upon amendment of the
articles of incorporation.
(3) If pursuant to this section, the
number of authorized shares is reduced, articles of amendment shall be adopted
by the board of directors which may be without shareholder action and shall be
delivered to the office for filing. The articles shall set forth:
(a) The name of the corporation;
(b) The reduction in the number of
authorized shares, itemized by class and series; and
(c) The total number of authorized shares,
itemized by class and series, remaining after reduction of the shares.
(4) For purposes of this section, if
shares of one class or series of a corporation are converted into shares of
another class or series of the corporation, the shares so converted shall be
considered to have been acquired by the corporation. [1987 c.52 §47; 1993 c.403
§1]
(Distributions)
60.181
Distributions to shareholders.
(1) A board of directors may authorize and the corporation may make
distributions to its shareholders subject to restriction by the articles of
incorporation and the limitation in subsection (3) of this section.
(2) If the board of directors does not fix
the record date for determining shareholders entitled to a distribution, other
than a date involving a purchase, redemption or other acquisition of the
corporations shares, it is the date the board of directors authorizes the
distribution.
(3) A distribution may be made only if,
after giving it effect, in the judgment of the board of directors:
(a) The corporation would be able to pay
its debts as they become due in the usual course of business; and
(b) The corporations total assets would
at least equal the sum of its total liabilities plus, unless the articles of
incorporation permit otherwise, the amount that would be needed if the
corporation were to be dissolved at the time of the distribution, to satisfy
the preferential rights upon dissolution of shareholders whose preferential
rights are superior to those receiving the distribution.
(4) The board of directors may base a
determination that a distribution is not prohibited under subsection (3) of
this section either on financial statements prepared on the basis of accounting
practices and principles that are reasonable in the circumstances or on a fair
valuation or other method that is reasonable in the circumstances.
(5) The effect of a distribution under
subsection (3) of this section is measured:
(a) In the case of distribution by
purchase, redemption or other acquisition of the corporations shares, as of
the earlier of the date the money or other property is transferred or debt
incurred by the corporation or the date the shareholder ceases to be a
shareholder with respect to the acquired shares;
(b) In the case of any other distribution
of indebtedness, as of the date the indebtedness is distributed; and
(c) In all other cases, as of the date a
distribution is authorized if the payment occurs within 120 days after the date
of authorization or the date the payment is made if it occurs more than 120
days after the date of authorization.
(6) A corporations indebtedness to a
shareholder incurred by reason of a distribution made in accordance with this
section is at parity with the corporations indebtedness to its general
unsecured creditors, unless the shareholder agrees to subordination or the
corporation grants the shareholder a security interest or other lien against
corporate assets to secure the indebtedness. [1987 c.52 §48; 1989 c.1040 §13]
SHAREHOLDERS
(Meetings)
60.201
Annual meeting. (1) Except
as provided in subsection (4) of this section, a corporation shall hold an
annual meeting of the shareholders at a time stated in or fixed in accordance
with the bylaws.
(2) Annual shareholders meetings may be
held in or out of this state at the place stated in or fixed in accordance with
the bylaws. If no place is stated in or fixed in accordance with the bylaws,
annual meetings shall be held at the corporations principal office.
(3) The failure to hold an annual meeting
at the time stated in or fixed in accordance with a corporations bylaws does
not affect the validity of any corporate action.
(4) If the articles of incorporation or
bylaws of a corporation registered under the Investment Company Act of 1940, as
amended, so provide, the corporation shall not be required to hold an annual
meeting in any year in which an election of directors is not required under the
Investment Company Act of 1940, as amended. [1987 c.52 §49; 1991 c.883 §3; 1997
c.249 §24]
60.204
Special meeting. (1) A
corporation shall hold a special meeting of shareholders:
(a) On call of its board of directors or
the person or persons authorized to do so by the articles of incorporation or
bylaws; or
(b) Except as provided in this paragraph,
if the holders of at least 10 percent of all votes entitled to be cast on any
issue proposed to be considered at the proposed special meeting sign, date and
deliver to the corporations secretary one or more written demands for the
meeting describing the purpose or purposes for which it is to be held. The
articles of incorporation may fix a lower percentage or a higher percentage not
exceeding 25 percent of all the votes entitled to be cast on any issue proposed
to be considered. Unless otherwise provided in the articles of incorporation, a
written demand for a special meeting may be revoked by a writing to that effect
signed by a shareholder who signed the original demand, and received by the
corporation prior to the receipt by the corporation of a demand sufficient to
require the holding of a special meeting.
(2) If not otherwise fixed under ORS
60.207 or 60.221, the record date for determining shareholders entitled to
demand a special meeting is the date the first shareholder signs the demand.
(3) Special shareholders meetings may be
held in or out of this state at the place stated in or fixed in accordance with
the bylaws. If no place is stated or fixed in accordance with the bylaws,
special meetings shall be held at the corporations principal office.
(4) Only business within the purpose or
purposes described in the meeting notice required by ORS 60.214 (3) may be
conducted at a special shareholders meeting. [1987 c.52 §50; 2003 c.80 §3]
60.207
Court-ordered meeting. (1)
The circuit court of the county where a corporations principal office is
located, or, if the principal office is not in this state, where the registered
office of the corporation is or was last located, may summarily order a meeting
to be held:
(a) On application of any shareholder of
the corporation entitled to participate in an annual meeting if an annual
meeting was not held within the earlier of six months after the end of the
corporations fiscal year or 15 months after its last annual meeting; or
(b) On application of a shareholder who
signed a demand for a special meeting valid under ORS 60.204 and notice of the
special meeting was not given within 30 days after the date the demand was
delivered to the corporations secretary or the special meeting was not held in
accordance with the notice.
(2) The court may fix the time and place
of the meeting, determine the shares entitled to participate in the meeting,
specify a record date for determining shareholders entitled to notice of and to
vote at the meeting, prescribe the form and content of the meeting notice, fix
the quorum required for specific matters to be considered at the meeting or
direct that the votes represented at the meeting constitute a quorum for action
on those matters and enter other orders necessary to accomplish the purpose or
purposes of the meeting.
(3) The shareholders request shall be set
for hearing at the earliest possible time and shall take precedence over all
matters, except matters of the same character and hearings on preliminary
injunctions under ORCP 79 B(3). No order shall be issued by the court under
this section without notice to the corporation at least five days in advance of
the time specified for the hearing unless a different period is fixed by order
of the court. [1987 c.52 §51]
60.209
Meeting chairperson; closing of polls. (1) At each meeting of shareholders, a chairperson shall preside. The
chairperson shall be appointed as provided in the bylaws or, in the absence of
such provision, by the board.
(2) Unless the articles of incorporation
or bylaws provide otherwise, the chairperson shall determine the order of
business and shall have the authority to establish rules for the conduct of the
meeting.
(3) Any rules adopted for, and the conduct
of, the meeting shall be fair to shareholders.
(4) The chairperson of the meeting shall
announce at the meeting when the polls close for each matter voted upon. If no
announcement is made, the polls shall be considered to have closed upon the
final adjournment of the meeting. After the polls close, no ballots, proxies or
votes, or any revocations or changes thereto, may be accepted. [2003 c.80 §5]
60.210 [Repealed by 1953 c.549 §138]
60.211
Action without meeting.
(1)(a) Action required or permitted by this chapter to be taken at a
shareholders meeting may be taken without a meeting if the action is taken by
all the shareholders entitled to vote on the action.
(b) Notwithstanding paragraph (a) of this
subsection, the articles of incorporation may provide that action required or
permitted by this chapter to be taken at a shareholders meeting may be taken
without a meeting if the action is taken by shareholders having not less than
the minimum number of votes that would be necessary to take such action at a
meeting at which all shareholders entitled to vote on the action were present
and voted.
(c) The action taken under this subsection
must be evidenced by one or more written consents describing the action taken,
signed by all the shareholders entitled to vote on the action, or by those
shareholders taking action under paragraph (b) of this subsection, and
delivered to the corporation for inclusion in the minutes or filing with the
corporate records.
(d) Action taken under paragraph (a) of
this subsection is effective when the last shareholder signs the consent,
unless the consent specifies an earlier or later effective date.
(e) Action taken under paragraph (b) of
this subsection is effective when the consent or consents bearing sufficient
signatures are delivered to the corporation, unless the consent or consents
specify an earlier or later effective date. An effective date specified under
this paragraph may not be earlier than the effective date of the provision
permitting action under paragraph (b) of this subsection.
(2) If not otherwise determined under ORS
60.207 or 60.221, the record date for determining shareholders entitled to take
action without a meeting is the date the first shareholder signs a consent
under subsection (1) of this section.
(3) A consent signed under this section
has the effect of a meeting vote and may be described as such in any document.
(4)(a) If this chapter requires that
notice of proposed action be given to nonvoting shareholders and the action is
to be taken by unanimous consent of the voting shareholders, the corporation
must give its nonvoting shareholders written notice of the proposed action at
least 10 days before the action is taken.
(b) If this chapter requires that notice
of proposed action be given to nonvoting shareholders and the action is taken
as provided in subsection (1)(b) of this section, the corporation must give its
nonvoting shareholders written notice of the action promptly after the action
is taken.
(c) The notice given under this subsection
must contain or be accompanied by the same material that, under this chapter,
would have been required to be sent to nonvoting shareholders in a notice of
meeting at which the proposed action would have been submitted to the
shareholders for action.
(5) If action is taken as provided in
subsection (1)(b) of this section, the corporation must give written notice of
the action promptly after the action is taken to shareholders who did not
consent in writing under subsection (1)(b) of this section. The notice given
under this subsection must contain or be accompanied by the same material that,
under this chapter, would have been required to be sent to those shareholders
in a notice of meeting at which the proposed action would have been submitted
to those shareholders for action.
(6) The fact that an action is taken by
written consent without a meeting does not impair any rights a shareholder who
does not consent to the action may have to dissent and obtain payment for the
shareholders shares under ORS 60.551 to 60.594. A shareholder who consents to
the action in writing is not entitled to receive payment for the shareholders
shares under ORS 60.551 to 60.594. [1987 c.52 §52; 2001 c.315 §22]
60.214
Notice of meeting. (1) A
corporation shall notify shareholders of the date, time and place of each
annual and special shareholders meeting not earlier than 60 days nor less than
10 days before the meeting date. Unless this chapter or the articles of
incorporation require otherwise, the corporation is required to give notice
only to shareholders entitled to vote at the meeting.
(2) Unless required by this chapter or the
articles of incorporation, notice of an annual meeting need not include a
description of the purpose or purposes for which the meeting is called.
(3) Notice of a special meeting must
include a description of the purpose or purposes for which the meeting is
called.
(4) If not otherwise fixed under ORS
60.207 or 60.221, the record date for determining shareholders entitled to
notice of and to vote at an annual or special shareholders meeting is the day
before the first notice is mailed or otherwise transmitted for delivery to
shareholders in accordance with ORS 60.034.
(5) Unless the bylaws require otherwise,
if an annual or special shareholders meeting is adjourned to a different date,
time or place, notice need not be given of the new date, time or place if the
new date, time or place is announced at the meeting before adjournment. If a
new record date for the adjourned meeting is or must be fixed under ORS 60.221,
however, notice of the adjourned meeting must be given under this section to
persons who are shareholders as of the new record date. [1987 c.52 §53; 1989
c.1040 §16; 1991 c.883 §4; 2003 c.80 §6]
60.217
Waiver of notice. (1) A shareholder
may at any time waive any notice required by this chapter, the articles of
incorporation or bylaws. The waiver must be in writing, be signed by the
shareholder entitled to the notice and be delivered to the corporation for
inclusion in the minutes for filing with the corporate records.
(2) A shareholders attendance at a
meeting waives objection to:
(a) Lack of notice or defective notice of
the meeting, unless the shareholder at the beginning of the meeting objects to
holding the meeting or transacting business at the meeting; and
(b) Consideration of a particular matter
at the meeting that is not within the purpose or purposes described in the
meeting notice, unless the shareholder objects to considering the matter when
it is presented. [1987 c.52 §54]
60.219
Adjournment of meeting.
Unless otherwise provided in the articles of incorporation or bylaws, a
majority of votes represented at a meeting of shareholders, whether or not a
quorum, may adjourn the meeting from time to time to a different time and place
without further notice to any shareholder of any adjournment, except as such
notice may be required by ORS 60.214. At the adjourned meeting at which a
quorum is present, any business may be transacted that might have been
transacted at the meeting originally held. [1989 c.1040 §18]
60.220 [Repealed by 1953 c.549 §138]
60.221
Record date. (1) The bylaws
may fix or provide the manner of fixing the record date for one or more voting
groups in order to determine the shareholders entitled to notice of a
shareholders meeting, to demand a special meeting, to vote or to take any
other action. The record date shall be the same for all voting groups. If the
bylaws do not fix or provide for fixing a record date, the board of directors
of the corporation may fix a future date, or a later time on the date the board
of directors fixes the record date, as the record date.
(2) A record date fixed under this section
may not be more than 70 days before the meeting or action requiring a
determination of shareholders.
(3) A determination of shareholders
entitled to notice of or to vote at a shareholders meeting is effective for
any adjournment of the meeting unless the board of directors fixes a new record
date, which it must do if the meeting is adjourned to a date more than 120 days
after the date fixed for the original meeting.
(4) If a court orders a meeting adjourned
to a date more than 120 days after the date fixed for the original meeting, it
may provide that the original record date continues in effect or it may fix a
new record date. [1987 c.52 §55; 1993 c.403 §2]
60.222
Participation at meeting.
(1) Unless the articles of incorporation or bylaws provide otherwise, the
bylaws or the board of directors, by resolution adopted in advance either
specifically with respect to a particular meeting or generally with respect to
future meetings, may permit any or all shareholders to participate in an annual
or special meeting by, or may permit the conduct of a meeting through, use of
any means of communication by which all shareholders participating may
simultaneously hear each other. A shareholder participating in a meeting by
this means is deemed to be present in person at the meeting.
(2) The notice of each annual or special
meeting of shareholders at which participation in the manner referred to in
subsection (1) of this section is permitted shall state that fact and shall
describe how any shareholder desiring to participate may notify the corporation
of the shareholders desire to be included in the meeting. [1989 c.1040 §15]
60.223
Meeting inspectors; duties.
(1) A corporation having any shares listed on a national securities exchange or
regularly traded in a market maintained by one or more members of a national or
affiliated securities association shall, and any other corporation may, appoint
one or more inspectors to act at a meeting of shareholders and make a written
report of the inspectors determinations. Each inspector shall take and sign an
oath to faithfully execute the duties of the inspector with strict impartiality
and according to the best of the inspectors ability.
(2) The inspectors shall:
(a) Ascertain the number of shares
outstanding and the voting power of each share;
(b) Determine the shares represented at a
meeting;
(c) Determine the validity of proxies and
ballots;
(d) Count all votes; and
(e) Determine the result.
(3) An inspector may be an officer or
employee of the corporation. [2003 c.80 §9]
(Voting)
60.224
Shareholders list for meeting.
(1) After fixing a record date for a meeting, a corporation shall prepare an
alphabetical list of the names of all its shareholders who are entitled to
notice of a shareholders meeting. The list must be arranged by voting group,
and within each voting group by class or series of shares and show the address
of and number of shares held by each shareholder.
(2) The shareholders list must be
available for inspection by any shareholder, beginning two business days after
notice of the meeting is given for which the list was prepared and continuing
through the meeting, at the corporations principal office or at a place
identified in the meeting notice in the city where the meeting will be held. A
shareholder, the shareholders agent or attorney is entitled on written demand
to inspect and, subject to the requirements of ORS 60.774 (3), to copy the list
during regular business hours and at the shareholders expense during the
period it is available for inspection.
(3) The corporation shall make the
shareholders list available at the meeting, and any shareholder, the
shareholders agent or attorney is entitled to inspect the list at any time
during the meeting or any adjournment.
(4) If the corporation refuses to allow a
shareholder, the shareholders agent or attorney to inspect the shareholders
list before or at the meeting or copy the list as permitted by subsection (2)
of this section, on application of the shareholder, the circuit court of the
county where a corporations principal office is located, or if the principal
office is not in this state, where its registered office is or was last
located, may enter a temporary restraining order or preliminary injunction
pursuant to ORCP 79 ordering the inspection or copying at the corporations
expense and may postpone the meeting for which the list was prepared until the
inspection or copying is complete. The party initiating such a proceeding shall
not be required to post an undertaking pursuant to ORCP 82 A.
(5) Refusal or failure to prepare or make
available the shareholders list does not affect the validity of action taken
at the meeting. [1987 c.52 §56]
60.227
Voting entitlement of shares.
(1) Except as provided in subsections (2) and (3) of this section and ORS
60.807, or unless the articles of incorporation provide otherwise, each outstanding
share, regardless of class, is entitled to one vote on each matter voted on at
a shareholders meeting. Only shares are entitled to vote.
(2) The shares of a corporation are not
entitled to vote if they are owned, directly or indirectly, by a second
domestic or foreign corporation, and the first corporation owns, directly or
indirectly, a majority of the shares entitled to vote for directors of the
second corporation.
(3) Subsection (2) of this section does
not limit the power of a corporation to vote any shares, including its own
shares, held by it in a fiduciary capacity.
(4) Redeemable shares are not entitled to
vote after notice of redemption is mailed to the holders and a sum sufficient
to redeem the shares has been deposited with a bank, trust company or other
financial institution under an irrevocable obligation to pay the holders the
redemption price on surrender of the shares. [1987 c.52 §57; 1989 c.4 §7]
60.230 [Repealed by 1953 c.549 §138]
60.231
Proxies. (1) A shareholder
may vote shares in person or by proxy.
(2) A shareholder may authorize a person
or persons to act for the shareholder as proxy in any one of the following
manners:
(a) A shareholder or the shareholders
designated officer, director, employee or agent may execute a writing by:
(A) Signing it; or
(B) Causing the shareholders signature or
the signature of the designated officer, director, employee or agent of the
shareholder to be affixed to the writing by any reasonable means, including
facsimile signature.
(b) A shareholder may authorize an
electronic transmission that:
(A) May be transmitted to:
(i) The person who will be the holder of
the proxy;
(ii) The proxy solicitation firm; or
(iii) A proxy support service organization
or similar agency authorized by the person who will be the holder of the proxy
to receive the electronic transmission; and
(B) Must contain or be accompanied by
information from which it can be determined that the shareholder or the
shareholders designated officer, director, employee or agent authorized the
transmission.
(c) Any other method allowed by law.
(3) A copy, facsimile telecommunication or
other reliable reproduction of the writing or electronic transmission created
under subsection (2)(a) or (b) of this section may be used instead of the
original writing or electronic transmission for all purposes for which the
original writing or electronic transmission may be used if the copy, facsimile
telecommunication or other reproduction is a complete copy of the entire
original writing or electronic transmission.
(4) An authorization of a proxy is
effective when received by the secretary or other officer or agent authorized
to tabulate votes. An authorization is valid for 11 months unless a longer
period is expressly provided in the authorization form.
(5) An authorization of a proxy is
revocable by the shareholder unless the authorization conspicuously states that
it is irrevocable and the authorization is coupled with an interest.
Authorizations coupled with an interest include the authorization of:
(a) A pledgee;
(b) A person who purchased or agreed to
purchase the shares;
(c) A creditor of the corporation who
extended it credit under terms requiring the authorization;
(d) An employee of the corporation whose
employment contract requires the authorization; or
(e) A party to a voting agreement created
under ORS 60.257.
(6) The death or incapacity of the
shareholder authorizing a proxy does not affect the right of the corporation to
accept the proxys authority unless notice of the death or incapacity is
received by the secretary or other officer or agent authorized to tabulate
votes before the proxy exercises the proxys authority under the authorization.
(7) An authorization made irrevocable
under subsection (5) of this section is revoked when the interest with which it
is coupled is extinguished.
(8) A transferee for value of shares
subject to an irrevocable authorization may revoke the authorization if the
transferee did not know of its existence when the transferee acquired the
shares and the existence of the irrevocable authorization was not noted
conspicuously on the certificate representing the shares or on the information
statement for shares without certificates.
(9) Subject to ORS 60.237 and to any
express limitation on the proxys authority appearing on the face of the
authorization form or electronic transmission, a corporation is entitled to
accept the proxys vote or other action as that of the shareholder making the
authorization. [1987 c.52 §58; 1999 c.371 §1; 2001 c.104 §17; 2003 c.80 §7]
60.234
Shares held by nominees. (1)
A corporation may establish a procedure by which the beneficial owner of shares
that are registered in the name of a nominee is recognized by the corporation
as the shareholder. The extent of this recognition may be determined in the
procedure.
(2) The procedure referred to in
subsection (1) of this section may set forth:
(a) The types of nominees to which it
applies;
(b) The rights or privileges that the
corporation recognizes in a beneficial owner;
(c) The manner in which the procedure is
selected by the nominee;
(d) The information that must be provided
when the procedure is selected;
(e) The period for which selection of the
procedure is effective; and
(f) Other aspects of the rights and duties
created. [1987 c.52 §59]
60.237
Corporations acceptance of votes. (1) If the name signed on a vote, consent, waiver or proxy
authorization corresponds to the name of a shareholder, the corporation, if
acting in good faith, is entitled to accept the vote, consent, waiver or proxy
authorization and give it effect as the act of the shareholder.
(2) If the name signed on a vote, consent,
waiver or proxy authorization does not correspond to the name of its
shareholder, the corporation, if acting in good faith, is nevertheless entitled
to accept the vote, consent, waiver or proxy authorization and give it effect
as the act of the shareholder if:
(a) The shareholder is an entity and the
name signed purports to be that of an officer or agent of the entity;
(b) The name signed purports to be that of
an administrator, executor, guardian or conservator representing the
shareholder and, if the corporation requests, evidence of fiduciary status
acceptable to the corporation has been presented with respect to the vote,
consent, waiver or proxy authorization;
(c) The name signed purports to be that of
a receiver or trustee in bankruptcy of the shareholder and, if the corporation
requests, evidence of this status acceptable to the corporation has been presented
with respect to the vote, consent, waiver or proxy authorization;
(d) The name signed purports to be that of
a pledgee, beneficial owner or attorney-in-fact of the shareholder and, if the
corporation requests, evidence acceptable to the corporation of the signatorys
authority to sign for the shareholder has been presented with respect to the
vote, consent, waiver or proxy authorization; or
(e) Two or more persons are the
shareholder as cotenants or fiduciaries and the name signed purports to be the
name of at least one of the coowners and the person signing appears to be
acting on behalf of all coowners.
(3) The corporation is entitled to reject
a vote, consent, waiver or proxy authorization if the secretary or other
officer or agent authorized to tabulate votes, acting in good faith, has
reasonable basis for doubt about the validity of the signature on it or about
the signatorys authority to sign for the shareholder.
(4) The corporation and its officer or
agent who accepts or rejects a vote, consent, waiver or proxy authorization in
good faith and in accordance with the standards of this section are not liable
in damages to the shareholder for the consequences of the acceptance or
rejection.
(5) Corporate action based on the
acceptance or rejection of a vote, consent, waiver or proxy authorization under
this section is valid unless a court of competent jurisdiction determines
otherwise. [1987 c.52 §60; 1999 c.371 §3]
60.241
Quorum and voting requirements for voting groups. (1) Shares entitled to vote as a separate
voting group may take action on a matter at a meeting only if a quorum of those
shares exists with respect to that matter. Unless the articles of incorporation
or this chapter provide for a lesser or greater number in accordance with ORS
60.247, a majority of the votes entitled to be cast on the matter by the voting
group constitutes a quorum of that voting group for action on that matter.
(2) Once a share is represented for any
purpose at a meeting, it is deemed present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is or must be set for that adjourned meeting.
(3) If a quorum exists, action on a
matter, other than the election of directors, by a voting group is approved if
the votes cast within the voting group favoring the action exceed the votes
cast opposing the action, unless the articles of incorporation or this chapter
require a greater number of affirmative votes.
(4) An amendment of articles of
incorporation adding, changing or deleting a quorum or voting requirement for a
voting group greater than specified in subsection (2) or (3) of this section is
governed by ORS 60.247.
(5) The election of directors is governed
by ORS 60.251. [1987 c.52 §61]
60.244
Action by single and multiple voting groups. (1) If the articles of incorporation or this chapter provide for
voting by a single group on a matter, action on that matter is taken when voted
upon by that voting group as provided in ORS 60.241.
(2) If the articles of incorporation or
this chapter provide for voting by two or more voting groups on a matter,
action on that matter is taken only when voted upon by each of those voting
groups counted separately as provided in ORS 60.241. Action may be taken by one
voting group on a matter even though no action is taken by another voting group
entitled to vote on the matter. [1987 c.52 §62; 1991 c.883 §5]
60.247
Modification of quorum or voting requirements. (1) The articles of incorporation may
provide for a lesser or greater quorum requirement for shareholders, or voting
groups of shareholders, than is provided for by this chapter, but in no event
shall a quorum for shareholders, or any voting group of shareholders, consist
of less than one-third of the votes entitled to be cast on any matter by the
shareholders, or voting group of shareholders. The articles of incorporation
may provide for a greater voting requirement for shareholders, or voting groups
of shareholders, than is provided for by this chapter.
(2) An amendment to the articles of
incorporation that adds a greater quorum or voting requirement must meet the
quorum requirement and be adopted by the vote and voting groups required to
take action under the quorum and voting requirements then in effect. An amendment
to the articles of incorporation that changes or deletes a greater quorum or
voting requirement must meet the quorum requirement and be adopted by the vote
and voting groups required to take action immediately prior to the change or
deletion. [1987 c.52 §63; 1989 c.1040 §19]
60.251
Voting for directors. (1)
Unless otherwise provided in the articles of incorporation, directors are
elected by a plurality of the votes cast by the shares entitled to vote in the
election at a meeting at which a quorum is present.
(2) Shareholders do not have a right to
cumulate their votes for directors unless the articles of incorporation so
provide.
(3) A statement included in the articles
of incorporation that all shareholders are entitled to cumulate their votes
for directors, a designated voting group of shareholders are entitled to
cumulate their votes for director or words of similar import means that the
shareholders designated are entitled to multiply the number of votes they are
entitled to cast by the number of directors for whom they are entitled to vote
and cast the product for a single candidate or distribute the product among two
or more candidates. [1987 c.52 §64; 1993 c.403 §3]
(Voting
Trusts and Agreements)
60.254
Voting trusts. (1) One or
more shareholders may create a voting trust and conferring on a trustee the
right to vote or otherwise act for them by signing an agreement setting out the
provisions of the trust which may include anything consistent with its purpose
and transferring their shares to the trustee. When a voting trust agreement is
signed, the trustee shall prepare a list of the names and addresses of all
owners of beneficial interests in the trust, together with the number and class
of shares each transferred to the trust, and deliver copies of the list and
agreement to the corporations principal office.
(2) A voting trust becomes effective on
the date the first shares subject to the trust are registered in the trustees
name. A voting trust is valid for not more than 10 years after its effective
date unless extended under subsection (3) of this section.
(3) All or some of the parties to a voting
trust may extend it for additional terms of not more than 10 years each by
signing an extension agreement and obtaining the voting trustees written
consent to the extension. An extension is valid for 10 years from the date the
first shareholder signs the extension agreement. The voting trustee must
deliver copies of the extension agreement and list of beneficial owners to the
corporations principal office. An extension agreement binds only those parties
signing it. [1987 c.52 §65]
60.257
Voting agreements. (1) Two
or more persons may provide for the manner in which they will vote their shares
by signing an agreement for that purpose. A voting agreement created under this
section is not a voting trust subject to the provisions of ORS 60.254.
(2) A voting agreement created under this
section is specifically enforceable. [1987 c.52 §66]
(Derivative
Proceedings)
60.261
Derivative proceedings. (1)
A person may not commence a proceeding in the right of a domestic or foreign
corporation unless the person was a shareholder of the corporation when the
transaction complained of occurred or unless the person became a shareholder
through transfer by operation of law from one who was a shareholder at that
time.
(2) A complaint in a proceeding brought in
the right of a corporation must allege with particularity the demand made, if
any, to obtain action by the board of directors and either that the demand was
refused or ignored or why a demand was not made. Whether or not a demand for
action was made, if the corporation commences an investigation of the charges
made in the demand or complaint, the court may stay any proceeding until the
investigation is completed.
(3) A proceeding commenced under this
section may not be discontinued or settled without the courts approval. If the
court determines that a proposed discontinuance or settlement will
substantially affect the interest of the corporations shareholders or a class
of shareholders, the court shall direct that notice be given the shareholders
affected.
(4) For purposes of this section, shareholder
includes a beneficial owner whose shares are held in a voting trust or held by
a nominee on behalf of the beneficial owner. [1987 c.52 §67]
(Shareholder
Agreements)
60.265
Validity of shareholder agreements inconsistent with chapter; purposes; notice
of agreement; effect on liability. (1) An agreement among the shareholders of a corporation entered into
after December 31, 1993, that is inconsistent with one or more other provisions
of this chapter is effective among the shareholders and the corporation, and
binding on the board of directors, if the agreement complies with this section
and it:
(a) Restricts the discretion or powers of
the board of directors;
(b) Establishes who shall be directors or
officers of the corporation or establishes their terms of office or manner of
selection or removal;
(c) Governs, in general or in regard to
specific matters, the exercise or division of voting power by or between the
shareholders and directors or by or among any of them, including use of
weighted voting rights or director proxies;
(d) Establishes the terms and conditions
of any agreement for the transfer or use of property or the provision of
services between the corporation and any shareholder, director, officer or
employee of the corporation or among any of them; or
(e) Requires dissolution of the
corporation at the request of one or more of the shareholders or upon the
occurrence of a specified event or contingency.
(2) An agreement authorized by this
section shall be:
(a) Set forth:
(A) In the articles of incorporation or
bylaws and approved by all persons who are shareholders at the time of the
agreement; or
(B) In a written agreement that is signed
by all persons who are shareholders at the time of the agreement and is made
known to the corporation;
(b) Subject to amendment only by all
persons who are shareholders at the time of the amendment, unless the agreement
provides otherwise; and
(c) Valid for 10 years, unless the
agreement provides otherwise.
(3) The existence of an agreement
authorized by this section shall be noted conspicuously on the front or back of
each certificate for outstanding shares or on the information statement
required by ORS 60.164 (2). If at the time of the agreement the corporation has
shares outstanding represented by certificates, the corporation shall recall
the outstanding certificates and issue substitute certificates that comply with
this subsection. The failure to note the existence of the agreement on the
certificate or information statement shall not affect the validity of the
agreement or any action taken pursuant to it. Any purchaser of shares who, at the
time of purchase, did not have knowledge of the existence of the agreement
shall be entitled to rescission of the purchase. A purchaser shall be deemed to
have knowledge of the existence of the agreement if its existence is noted on
the certificate or information statement for the shares in compliance with this
subsection and, if the shares are not represented by a certificate, the
information statement is delivered to the purchaser at or prior to the time of
purchase of the shares. An action to enforce the right of rescission authorized
by this subsection must be commenced within the earlier of:
(a) Ninety days after notice from the
corporation or the seller to the purchaser of the existence of the agreement
describing the rights of a purchaser without knowledge of the existence of the
agreement, and stating that failure to timely exercise rescission rights will
result in their termination;
(b) One year after discovery of the
existence of the agreement; or
(c) Three years after the time of purchase
of the shares.
(4) An agreement authorized by this
section shall cease to be effective when shares of the corporation are listed
on a national securities exchange or quoted on the National Association of
Securities Dealers, Inc. Automated Quotation System. If the agreement ceases to
be effective for any reason and is contained or referred to in the corporations
articles of incorporation or bylaws, the board of directors may adopt, without
shareholder action, an amendment to the articles of incorporation or bylaws to
delete the agreement and any references to it.
(5) An agreement authorized by this
section that limits the discretion or powers of the board of directors shall
relieve the directors of, and impose upon the person or persons in whom such
discretion or powers are vested, liability for acts or omissions imposed by law
on directors to the extent that the discretion or powers of the directors are
limited by the agreement.
(6) The existence or performance of an
agreement authorized by this section shall not be a ground for imposing
personal liability on any shareholder for the acts or debts of the corporation
even if the agreement or its performance treats the corporation as if it were a
partnership or results in failure to observe the corporate formalities
otherwise applicable to the matters governed by the agreement.
(7) Incorporators or subscribers for
shares may act as shareholders with respect to an agreement authorized by this
section if no shares have been issued when the agreement is made. [1993 c.403 §12]
DIRECTORS AND
OFFICERS
(Board of
Directors)
60.301
Requirement for and duties of board of directors. (1) Each corporation shall have a board of
directors.
(2) All corporate powers shall be
exercised by or under the authority of, and the business and affairs of the
corporation managed under the direction of, the board of directors, subject to
any limitation set forth in the articles of incorporation or in an agreement
authorized by ORS 60.265. [1987 c.52 §68; 1993 c.403 §4]
60.304
Qualifications of directors.
The articles of incorporation or bylaws may prescribe qualifications for
directors. A director need not be a resident of this state or a shareholder of
the corporation unless required by the articles of incorporation or bylaws. [1987
c.52 §69]
60.307
Number and election of directors. (1) A board of directors must consist of one or more individuals, with
the number specified in or fixed in accordance with the articles of
incorporation or bylaws. Notwithstanding ORS 60.001 (21), the estate of an
incompetent individual or a deceased individual may not be a director.
(2) The number of directors may be
increased or decreased from time to time by amendment to, or in the manner
provided in, the articles of incorporation or the bylaws.
(3) Directors are elected at the first
annual shareholders meeting and at each annual meeting thereafter unless their
terms are staggered under ORS 60.317. [1987 c.52 §70; 2003 c.80 §10]
60.311
Election of directors by certain classes of shareholders. If the articles of incorporation authorize
dividing the shares into classes or series, the articles may also authorize the
election of all or a specified number of directors by the holders of one or
more authorized classes or series of shares. Each class or classes or series of
shares entitled to elect one or more directors is a separate voting group for
purposes of the election of directors. [1987 c.52 §71]
60.314
Terms of directors generally.
(1) The terms of the initial directors of a corporation expire at the first
shareholders meeting at which directors are elected.
(2) The terms of all other directors
expire at the next annual shareholders meeting following their election unless
their terms are staggered under ORS 60.317.
(3) A decrease in the number of directors
does not shorten an incumbent directors term.
(4) The term of a director elected by the
board of directors to fill a vacancy expires at the next shareholders meeting
at which directors are elected.
(5) Despite the expiration of a directors
term, the director continues to serve until the directors successor is elected
and qualifies or until there is a decrease in the number of directors. [1987
c.52 §72; 1989 c.1040 §20]
60.317
Staggered terms for directors.
(1) The articles of incorporation or the bylaws may provide for staggering the
terms of directors by dividing the total number of directors into two or three
groups, with each group to be as nearly equal in number as possible.
(2) If the terms of the directors are
staggered, the terms of directors in the first group expire at the first annual
shareholders meeting after their election, the terms of the second group
expire at the second annual shareholders meeting after their election and the
terms of the third group, if any, expire at the third annual shareholders
meeting after their election. At each annual shareholders meeting held
thereafter, directors shall be chosen for a term of two years or three years,
as the case may be, to succeed those whose terms expire.
(3) If the corporation has cumulative
voting, terms of directors may be staggered only if authorized by the articles
of incorporation and each group of directors contains at least three members. [1987
c.52 §73; 1989 c.1040 §21; 2003 c.80 §11; 2005 c.92 §1]
60.321
Resignation of directors.
(1) A director may resign at any time by delivering written notice to the board
of directors, its chairperson or the corporation.
(2) A resignation is effective when the
notice is effective under ORS 60.034 (5) unless the notice specifies a later
effective date.
(3) Once delivered, a notice of
resignation is irrevocable unless revocation is permitted by the board of
directors. [1987 c.52 §74]
60.324
Removal of directors by shareholders. (1) The shareholders may remove one or more directors with or without
cause unless the articles of incorporation provide that directors may be
removed only for cause.
(2) If a director is elected by a voting
group of shareholders, only the shareholders of that voting group may
participate in the vote to remove the director.
(3) If cumulative voting is authorized, a
director may not be removed if the number of votes sufficient to elect the
director under cumulative voting is voted against the directors removal. If
cumulative voting is not authorized, a director may be removed only if the
number of votes cast to remove the director exceed the number of votes cast not
to remove the director.
(4) A director may be removed by the
shareholders only at a meeting called for the purpose of removing the director
and the meeting notice must state that the purpose, or one of the purposes, of
the meeting is removal of the director. [1987 c.52 §75]
60.327
Removal of directors by judicial proceeding. (1) The circuit court of the county where a corporations principal
office is located or if the principal office is not in this state where its
registered office is or was last located, may remove a director of the
corporation from office in a proceeding commenced either by the corporation or
by its shareholders holding at least 10 percent of the outstanding shares of
any class if the court finds that:
(a) The director engaged in fraudulent or
dishonest conduct or gross abuse of authority or discretion with respect to the
corporation; and
(b) Removal is in the best interest of the
corporation.
(2) The court that removes a director may
bar the director from reelection for a period prescribed by the court.
(3) If shareholders commence a proceeding
under subsection (1) of this section, they shall make the corporation a party
defendant. [1987 c.52 §76]
60.331
Vacancy on board. (1) Unless
the articles of incorporation provide otherwise, if a vacancy occurs on a board
of directors, including a vacancy resulting from an increase in the number of
directors:
(a) The shareholders may fill the vacancy;
(b) The board of directors may fill the
vacancy; or
(c) If the directors remaining in office
constitute fewer than a quorum of the board, they may fill the vacancy by the
affirmative vote of a majority of all the directors remaining in office.
(2) If the vacant office is filled by the
shareholders and was held by a director elected by a voting group of
shareholders, then only the holders of shares of that voting group are entitled
to vote to fill the vacancy.
(3) A vacancy that will occur at a
specific later date, by reason of a resignation effective at later date under
ORS 60.321 (2) or otherwise may be filled before the vacancy occurs but the new
director may not take office until the vacancy occurs. [1987 c.52 §77]
60.334
Compensation of directors.
Unless the articles of incorporation or bylaws provide otherwise, the board of
directors may fix the compensation of directors. [1987 c.52 §78]
(Meetings and
Action of Board)
60.337
Meetings. (1) The board of
directors may hold regular or special meetings in or out of this state.
(2) Unless the articles of incorporation
or bylaws provide otherwise, the board of directors may permit any or all
directors to participate in a regular or special meeting by, or conduct the
meeting through, use of any means of communication by which all directors
participating may simultaneously hear each other during the meeting. A director
participating in a meeting by this means is deemed to be present in person at
the meeting. [1987 c.52 §79]
60.341
Action without meeting. (1)
Unless the articles of incorporation or bylaws provide otherwise, action
required or permitted by this chapter to be taken at a board of directors
meeting may be taken without a meeting if the action is taken by all members of
the board. The action must be evidenced by one or more written consents
describing the action taken, signed by each director, and included in the
minutes or filed with the corporate records reflecting the action taken.
(2) Action taken under this section is
effective when the last director signs the consent, unless the consent
specifies an earlier or later effective date.
(3) A consent signed under this section
has the effect of a meeting vote and may be described as such in any document. [1987
c.52 §80]
60.344
Notice of meeting. (1)
Unless the articles of incorporation or bylaws provide otherwise, regular
meetings of the board of directors may be held without notice of the date,
time, place or purpose of the meeting.
(2) Unless the articles of incorporation
or bylaws provide for a longer or shorter period, special meetings of the board
of directors must be preceded by at least two days notice of the date, time
and place of the meeting. The notice need not describe the purpose of the
special meeting unless required by the articles of incorporation or bylaws. [1987
c.52 §81]
60.347
Waiver of notice. (1) A
director may at any time waive any notice required by this chapter, the
articles of incorporation or bylaws. Except as provided by subsection (2) of
this section, the waiver must be in writing, must be signed by the director
entitled to the notice, must specify the meeting for which notice is waived and
must be filed with the minutes or corporate records.
(2) A directors attendance at or participation
in a meeting waives any required notice to the director of the meeting unless
the director at the beginning of the meeting, or promptly upon the directors
arrival, objects to holding the meeting or transacting business at the meeting
and does not thereafter vote for or assent to action taken at the meeting. [1987
c.52 §82]
60.351
Quorum and voting. (1)
Unless the articles of incorporation or bylaws requires a greater number or a
lesser number as authorized under subsection (2) of this section, a quorum of a
board of directors consists of:
(a) If the corporation has a fixed board
size, a majority of the fixed number of directors; or
(b) If the corporation has a
variable-range size board, a majority of the number of directors prescribed, or
if no number is prescribed, a majority of the number in office immediately
before the meeting begins.
(2) The articles of incorporation or
bylaws may authorize a quorum of a board of directors to consist of no fewer
than one-third of the fixed or prescribed number of directors determined under
subsection (1) of this section.
(3) If a quorum is present when a vote is
taken, the affirmative vote of a majority of directors present is the act of
the board of directors unless the articles of incorporation or bylaws require
the vote of a greater number of directors.
(4) A director who is present at a meeting
of the board of directors or a committee of the board of directors when
corporate action is taken is deemed to have assented to the action taken
unless:
(a) The director objects at the beginning
of the meeting, or promptly upon the directors arrival, to holding the meeting
or transacting business at the meeting;
(b) The directors dissent or abstention
from the action taken is entered in the minutes of the meeting; or
(c) The director delivers written notice
of dissent or abstention to the presiding officer of the meeting before its
adjournment or to the corporation immediately after adjournment of the meeting.
The right of dissent or abstention is not available to a director who votes in
favor of the action taken. [1987 c.52 §83]
60.354
Committees; powers; limitations. (1) Unless this chapter, the articles of incorporation or the bylaws
provide otherwise, a board of directors may create one or more committees and
appoint one or more members of the board of directors to serve on each
committee.
(2) Unless this chapter provides
otherwise, the creation of a committee and appointment of members to it must be
approved by the greater of:
(a) A majority of all the directors in
office when the action is taken; or
(b) The number of directors required by
the articles of incorporation or bylaws to take action under ORS 60.351.
(3) ORS 60.337 to 60.351 apply both to
committees of the board and to members of the committees.
(4) Except as provided in subsection (5)
of this section, to the extent specified by the board of directors or in the
articles of incorporation or bylaws, each committee may exercise the powers of
the board of directors under ORS 60.301.
(5) A committee may not:
(a) Authorize or approve distributions,
except according to a formula or method, or within limits, prescribed by the
board of directors;
(b) Approve or propose to shareholders
action that this chapter requires be approved by shareholders;
(c) Fill vacancies on the board of
directors or, subject to subsection (7) of this section, on any of its
committees; or
(d) Adopt, amend or repeal bylaws.
(6) The creation of, delegation of
authority to, or action by a committee does not alone constitute compliance by
a director with the standards of conduct described in ORS 60.357.
(7) The board of directors may appoint one
or more directors as alternate members of any committee to replace any absent
or disqualified member during the members absence or disqualification. Unless
the articles of incorporation, the bylaws or the resolution creating the
committee provide otherwise, in the event of the absence or disqualification of
a member of a committee, the member or members present at any meeting and not disqualified
from voting, unanimously, may appoint a director to act in place of the absent
or disqualified member. [1987 c.52 §84; 1989 c.1040 §22; 1991 c.883 §6; 1993
c.403 §5; 2003 c.80 §12]
(Standards of
Conduct)
60.357
General standards for directors. (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 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 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
persons 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
action taken as a director, or any failure to take any action, if the director
performed the duties of the directors 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. [1987 c.52 §85;
1989 c.4 §8]
60.361
Conflict of interest. (1) A
conflict of interest transaction is a transaction with the corporation in which
a director of the corporation has a direct or indirect interest. A conflict of
interest transaction is not voidable by the corporation solely because of the
directors interest in the transaction if any one of the following is true:
(a) The material facts of the transaction
and the directors interest were disclosed or known to the board of directors
or a committee of the board of directors and the board of directors or
committee authorized, approved or ratified the transaction;
(b) The material facts of the transaction
and the directors interest were disclosed or known to the shareholders entitled
to vote and they authorized, approved or ratified the transaction; or
(c) The transaction was fair to the
corporation.
(2) For purposes of this section, a
director of the corporation has an indirect interest in a transaction if:
(a) Another entity in which the director
has a material financial interest or in which the director is a general partner
is a party to the transaction; or
(b) Another entity of which the director
is a director, officer or trustee is a party to the transaction and the
transaction is or should be considered by the board of directors of the
corporation.
(3) For purposes of subsection (1)(a) of
this section, a conflict of interest transaction is authorized, approved or
ratified if it receives the affirmative vote of a majority of the directors on
the board of directors, or on the committee, who have no direct or indirect
interest in the transaction. A transaction may not be authorized, approved or
ratified under this section by a single director. If a majority of the
directors who have no direct or indirect interest in the transaction vote to
authorize, approve or ratify the transaction, a quorum is present for the
purpose of taking action under this section. The presence of, or a vote cast
by, a director with a direct or indirect interest in the transaction does not
affect the validity of any action taken under subsection (1)(a) of this section
if the transaction is otherwise authorized, approved or ratified as provided in
subsection (1) of this section.
(4) For purposes of subsection (1)(b) of
this section, a conflict of interest transaction is authorized, approved or
ratified if it receives the vote of a majority of the shares entitled to be
counted under this subsection, voting as a single voting group. Shares owned by
or voted under the control of a director who has a direct or indirect interest
in the transaction, and shares owned by or voted under the control of an entity
described in subsection (2)(a) of this section may be counted in a vote of
shareholders to determine whether to authorize, approve or ratify a conflict of
interest transaction under subsection (1)(b) of this section. A majority of the
shares, whether or not present, that are entitled to be counted in a vote on
the transaction under this subsection constitutes a quorum for the purpose of
taking action under this section. [1987 c.52 §86]
60.364
Loans to directors. (1)
Except as provided by subsection (3) of this section, a corporation may not
lend money to or guarantee the obligation of a director of the corporation
unless:
(a) The particular loan or guarantee is
approved by a majority of the votes represented by the outstanding voting
shares of all classes, voting as a single voting group, excluding the votes of
shares owned by or voted under the control of the benefited director; or
(b) The corporations board of directors
determines that the loan or guarantee benefits the corporation and either
approves the specific loan or guarantee or a general plan authorizing the loans
and guarantees.
(2) The fact that a loan or guarantee is
made in violation of this section does not affect the borrowers liability on
the loan.
(3) This section does not apply to loans
and guarantees authorized by statute regulating any special class of
corporations. [1987 c.52 §87]
60.367
Liability for unlawful distributions. (1) Unless the director complies with the applicable standards of
conduct described in ORS 60.357, a director who votes for or assents to a
distribution made in violation of this chapter or the articles of incorporation
is personally liable to the corporation for the amount of the distribution that
exceeds what could have been distributed without violating this chapter or the
articles of incorporation.
(2) A director held liable for an unlawful
distribution under subsection (1) of this section is entitled to contribution:
(a) From every other director who voted
for or assented to the distribution without complying with the applicable
standards of conduct described in ORS 60.357; and
(b) From each shareholder for the amount
the shareholder accepted knowing the distribution was made in violation of this
chapter or the articles of incorporation. [1987 c.52 §88]
(Officers)
60.371
Required officers. (1) A
corporation has the officers described in its bylaws or appointed by the board
of directors in accordance with the bylaws which shall include a president and
a secretary.
(2) A duly appointed officer may appoint
one or more officers or assistant officers if such appointment is authorized by
the bylaws or the board of directors.
(3) The secretary shall have the
responsibility for preparing minutes of the directors and shareholders
meetings and for authenticating records of the corporation.
(4) The same individual may simultaneously
hold more than one office in a corporation. [1987 c.52 §89]
60.374
Duties of officers. Each
officer has the authority and shall perform the duties set forth in the bylaws
or, to the extent consistent with the bylaws, the duties prescribed by the
board of directors or by direction of an officer authorized by the board of
directors to prescribe the duties of other officers. [1987 c.52 §90]
60.377
Standard of conduct for officers. (1) An officer with discretionary authority shall discharge the duties
of an officer under that authority:
(a) In good faith;
(b) With the care an ordinarily prudent
person in a like position would exercise under similar circumstances; and
(c) In a manner the officer reasonably
believes to be in the best interests of the corporation.
(2) In discharging the duties of an
officer, an officer 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 officer reasonably believes to be reliable and
competent in the matters presented; or
(b) Legal counsel, public accountants or
other persons as to matters the officer reasonably believes are within the
persons professional or expert competence.
(3) An officer is not acting in good faith
if the officer has knowledge concerning the matter in question that makes
reliance otherwise permitted by subsection (2) of this section unwarranted.
(4) An officer is not liable for any
action taken as an officer, or any failure to take any action, if the officer
performed the duties of the office in compliance with this section. [1987 c.52 §91]
60.381
Resignation and removal of officers. (1) An officer may resign at any time by delivering notice to the
corporation. A resignation is effective when the notice is effective under ORS
60.034 (5) unless the notice specifies a later effective time. If a resignation
is made effective at a later time and the corporation accepts the future
effective time, its board of directors or the appointing officer may fill the
pending vacancy before the effective time if the board of directors or the
appointing officer provides that the successor does not take office until the
effective time.
(2) An officer may be removed at any time
with or without cause by:
(a) The board of directors;
(b) The appointing officer, unless
otherwise provided by the bylaws or the board of directors; or
(c) Any other officer if authorized by the
bylaws or the board of directors.
(3) Once delivered, a notice of
resignation is irrevocable unless revocation is permitted by the board of
directors.
(4) As used in this section, appointing
officer means the officer or any successor to that officer who appointed the
officer resigning or being removed. [1987 c.52 §92; 1993 c.403 §6; 2003 c.80 §13]
60.384
Contract right of officers.
(1) The appointment of an officer does not itself create contract rights.
(2) Removal or resignation of an officer
does not affect the contract rights, if any, of the corporation or the officer.
[1987 c.52 §93]
(Indemnification)
60.387
Definitions for ORS 60.387 to 60.414. As used in ORS 60.387 to 60.414:
(1) Corporation includes any domestic or
foreign predecessor entity of a corporation in a merger or other transaction in
which the predecessors existence ceased upon consummation of the transaction.
(2) Director means an individual who is
or was a director of a corporation or an individual who, while a director of a
corporation, is or was serving at the corporations request as a director,
officer, partner, trustee, employee or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise. A director is considered to be serving an employee benefit plan at
the corporations request if the directors duties to the corporation also
impose duties on or otherwise involve services by the director to the plan or
to participants in or beneficiaries of the plan. Director includes, unless
the context requires otherwise, the estate or personal representative of a
director.
(3) Expenses include counsel fees.
(4) Liability means the obligation to
pay a judgment, settlement, penalty, fine, including an excise tax assessed
with respect to an employee benefit plan or reasonable expenses incurred with
respect to a proceeding.
(5) Officer means an individual who is
or was an officer of a corporation or an individual who, while an officer of a
corporation, is or was serving at the corporations request as a director,
officer, partner, trustee, employee or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise. An officer is considered to be serving an employee benefit plan at
the corporations request if the officers duties to the corporation also
impose duties on or include services by the officer to the employee benefit
plan or to participants in or beneficiaries of the plan. Officer includes,
unless the context requires otherwise, the estate or personal representative of
an officer.
(6) Party includes an individual who
was, is or is threatened to be made a named defendant or respondent in a
proceeding.
(7) Proceeding means any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative and whether formal or informal. [1987 c.52 §94]
60.391
Authority to indemnify directors. (1) Except as provided in subsection (4) of this section, a
corporation may indemnify an individual made a party to a proceeding because
the individual is or was a director against liability incurred in the
proceeding if:
(a) The conduct of the individual was in
good faith;
(b) The individual reasonably believed
that the individuals conduct was in the best interests of the corporation, or
at least not opposed to its best interests; and
(c) In the case of any criminal
proceeding, the individual had no reasonable cause to believe the individuals
conduct was unlawful.
(2) A directors conduct with respect to
an employee benefit plan for a purpose the director reasonably believed to be
in the interests of the participants in and beneficiaries of the plan is
conduct that satisfies the requirement of subsection (1)(b) of this section.
(3) The termination of a proceeding by
judgment, order, settlement, conviction or upon a plea of nolo contendere or
its equivalent is not, of itself, determinative that the director did not meet
the standard of conduct described in this section.
(4) A corporation may not indemnify a
director under this section:
(a) In connection with a proceeding by or
in the right of the corporation in which the director was adjudged liable to
the corporation; or
(b) In connection with any other
proceeding charging improper personal benefit to the director in which the
director was adjudged liable on the basis that personal benefit was improperly
received by the director.
(5) Indemnification permitted under this
section in connection with a proceeding by or in the right of the corporation
is limited to reasonable expenses incurred in connection with the proceeding. [1987
c.52 §95]
60.394
Mandatory indemnification.
Unless limited by its articles of incorporation, a corporation shall indemnify
a director who was wholly successful, on the merits or otherwise, in the
defense of any proceeding to which the director was a party because of being a
director of the corporation against reasonable expenses incurred by the
director in connection with the proceeding. [1987 c.52 §96]
60.397
Advance for expenses. (1) A
corporation may pay for or reimburse the reasonable expenses incurred by a
director who is a party to a proceeding in advance of final disposition of the
proceeding if:
(a) The director furnishes the corporation
a written affirmation of the directors good faith belief that the director has
met the standard of conduct described in ORS 60.391; and
(b) The director furnishes the corporation
a written undertaking, executed personally or on the directors behalf, to
repay the advance if it is ultimately determined that the director did not meet
the standard of conduct.
(2) The undertaking required by subsection
(1)(b) of this section must be an unlimited general obligation of the director
but need not be secured and may be accepted without reference to financial
ability to make repayment.
(3) Any authorization of payments under
this section may be made by provision in the articles of incorporation, or
bylaws, by a resolution of the shareholders or board of directors or by
contract. [1987 c.52 §97]
60.401
Court-ordered indemnification.
Unless the corporations articles of incorporation provide otherwise, a
director of the corporation who is a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court after giving
any notice the court considers necessary may order indemnification if it
determines:
(1) The director is entitled to mandatory
indemnification under ORS 60.394, in which case the court shall also order the
corporation to pay the directors reasonable expenses incurred to obtain
court-ordered indemnification; or
(2) The director is fairly and reasonably
entitled to indemnification in view of all the relevant circumstances, whether
or not the director met the standard of conduct set forth in ORS 60.391 or was
adjudged liable as described in ORS 60.391 (4), whether the liability is based
on a judgment, settlement or proposed settlement or otherwise. [1987 c.52 §98]
60.404
Determination and authorization of indemnification. (1) A corporation may not indemnify a
director under ORS 60.391 unless authorized in the specific case after a
determination has been made that indemnification of the director is permissible
in the circumstances because the director has met the standard of conduct set
forth in ORS 60.391.
(2) A determination that indemnification
of a director is permissible shall be made:
(a) By the board of directors by majority
vote of a quorum consisting of directors not at the time parties to the
proceeding;
(b) If a quorum cannot be obtained under
paragraph (a) of this subsection, by a majority vote of a committee duly
designated by the board of directors consisting solely of two or more directors
not at the time parties to the proceeding. However, directors who are parties
to the proceeding may participate in designation of the committee;
(c) By special legal counsel selected by
the board of directors or its committee in the manner prescribed in paragraph
(a) or (b) of this subsection or, if a quorum of the board of directors cannot
be obtained under paragraph (a) of this subsection and a committee cannot be
designated under paragraph (b) of this subsection, the special legal counsel
shall be selected by majority vote of the full board of directors, including
directors who are parties to the proceeding; or
(d) By the shareholders.
(3) Authorization of indemnification and
evaluation as to reasonableness of expenses shall be made in the same manner as
the determination that indemnification is permissible, except that if the
determination is made by special legal counsel, authorization of
indemnification and evaluation as to reasonableness of expenses shall be made
by those entitled under subsection (2)(c) of this section to select counsel. [1987
c.52 §99]
60.407
Indemnification of officers, employees and agents. Unless a corporations articles of
incorporation provide otherwise:
(1) An officer of the corporation is
entitled to mandatory indemnification under ORS 60.394, and is entitled to
apply for court-ordered indemnification under ORS 60.401, in each case to the
same extent as a director under ORS 60.394 and 60.401.
(2) The corporation may indemnify and
advance expenses under ORS 60.387 to 60.411 to an officer, employee or agent of
the corporation to the same extent as to a director. [1987 c.52 §100]
60.411
Insurance. A corporation may
purchase and maintain insurance on behalf of an individual against liability
asserted against or incurred by the individual who is or was a director,
officer, employee or agent of the corporation or who, while a director,
officer, employee or agent of the corporation, is or was serving at the request
of the corporation as a director, officer, partner, trustee, employee or agent
of another foreign or domestic corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise. The corporation may purchase and
maintain the insurance even if the corporation has no power to indemnify the
individual against the same liability under ORS 60.391 or 60.394. [1987 c.52 §101]
60.414
Application of ORS 60.387 to 60.411. (1) The indemnification and provisions for advancement of expenses
provided by ORS 60.387 to 60.411 shall not be deemed exclusive of any other
rights to which directors, officers, employees or agents may be entitled under
the corporations articles of incorporation or bylaws, any agreement, general
or specific action of its board of directors, vote of shareholders or
otherwise, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person. Specifically and not by way of
limitation, a corporation shall have the power to make or agree to make any further
indemnification, including advancement of expenses, of:
(a) Any director as authorized by the
articles of incorporation, any bylaws approved, adopted or ratified by the
shareholders or any resolution or agreement approved, adopted or ratified,
before or after such indemnification or agreement is made, by the shareholders,
provided that no such indemnification shall indemnify any director from or on
account of acts or omissions for which liability could not be eliminated under
ORS 60.047 (2)(d); and
(b) Any officer, employee or agent who is
not a director as authorized by its articles of incorporation or bylaws,
general or specific action of its board of directors or agreement. Unless the
articles of incorporation, or any such bylaws, agreement or resolution provide
otherwise, any determination as to any further indemnity under this paragraph
shall be made in accordance with ORS 60.404.
(2) If articles of incorporation limit
indemnification or advance of expenses, any indemnification and advance of expenses
are valid only to the extent consistent with the articles of incorporation.
(3) ORS 60.387 to 60.411 do not limit a
corporations power to pay or reimburse expenses incurred by a director in
connection with the directors appearance as a witness in a proceeding at a
time when the director has not been made a named defendant or respondent to a
proceeding. [1987 c.52 §102; 1991 c.883 §7]
AMENDMENT OF
ARTICLES OF INCORPORATION AND BYLAWS
(Amendment of
Articles of Incorporation)
60.431
Authority. (1) A corporation
may amend its articles of incorporation at any time to add, change or delete
any provision if the articles of incorporation as amended would be permitted
under this chapter as of the effective date of the amendment.
(2) A shareholder of the corporation does
not have a vested property right resulting from any provision in the articles
of incorporation, including provisions relating to management, control, capital
structure, dividend entitlement, purpose or duration of the corporation. [1987
c.52 §103]
60.434
Amendment by board of directors. Unless the articles of incorporation provide otherwise, a corporations
board of directors may adopt one or more amendments to the corporations
articles of incorporation without shareholder action to:
(1) Extend the duration of the corporation
if it was incorporated at a time when limited duration was required by law;
(2) Delete the names and addresses of the
initial directors;
(3) Delete the name and address of the
initial registered agent or registered office, if a statement of change is on
file with the office of the Secretary of State;
(4) Delete the mailing address if an
annual report has been filed with the office of the Secretary of State;
(5) Change the corporate name by
substituting the word corporation, incorporated, company, limited, or
the abbreviation corp., inc., co. or ltd., for a similar word or
abbreviation in the name, or by adding, deleting or changing a geographical
attribution for the name;
(6) In the case of a corporation
registered as an open-end investment company under the Investment Company Act
of 1940, as amended, increase or decrease the number of shares the corporation
is authorized to issue; or
(7) Make any other change expressly
permitted by this chapter to be made without shareholder action. [1987 c.52 §104;
1989 c.1040 §23; 1991 c.883 §8; 1997 c.249 §25]
60.437
Amendment by board of directors and shareholders. (1) A corporations board of directors may
propose one or more amendments to the articles of incorporation for submission
to the shareholders.
(2) For the amendment to be adopted, the
board of directors shall adopt a resolution setting forth the proposed
amendment and directing that it be submitted to a vote at a meeting of
shareholders, which may be either an annual or a special meeting, and the
shareholders entitled to vote on the amendment must approve the amendment as
provided in subsection (5) of this section.
(3) The board of directors may condition
its submission of the proposed amendment on any basis.
(4) The corporation shall notify each
shareholder, whether or not entitled to vote, of the proposed shareholders
meeting in accordance with ORS 60.214. The notice of meeting must also state
that the purpose, or one of the purposes, of the meeting is to consider the
proposed amendment and contain or be accompanied by a copy or summary of the
amendment.
(5) Unless this chapter, the articles of
incorporation or the board of directors acting pursuant to subsection (3) of
this section require a greater vote or a vote by voting groups, the amendment
to be adopted must be approved by:
(a) A majority of the votes entitled to be
cast on the amendment by any voting group with which the amendment would create
dissenters rights; and
(b) The votes required by ORS 60.241 and
60.244 by every other voting group entitled to vote on the amendment. [1987
c.52 §105; 1989 c.1040 §24]
60.441
Voting on amendments by voting groups. (1) The holders of the outstanding shares of a class are entitled to
vote as a separate voting group if shareholder voting is otherwise required by
this chapter on a proposed amendment if the amendment would:
(a) Increase or decrease the aggregate
number of authorized shares of the class;
(b) Effect an exchange or reclassification
of all or part of the shares of the class into shares of another class;
(c) Effect an exchange or
reclassification, or create the right of exchange, of all or part of the shares
of another class into shares of the class;
(d) Change the designation, rights,
preferences or limitations of all or part of the shares of the class;
(e) Change the shares of all or part of
the class into a different number of shares of the same class;
(f) Create a new class of shares having
rights or preferences with respect to distributions or to dissolution that are
prior, superior or substantially equal to the shares of the class;
(g) Increase the rights, preferences or
number of authorized shares of any class that, after giving effect to the
amendment, have rights or preferences with respect to distributions or to
dissolution that are prior, superior, or substantially equal to the shares of
the class;
(h) Limit or deny an existing preemptive
right of all or part of the shares of the class; or
(i) Cancel or otherwise affect rights to
distributions or dividends that have accumulated but not yet been declared on
all or part of the shares of the class.
(2) If a proposed amendment would affect a
series of a class of shares in one or more of the ways described in subsection
(1) of this section, the shares of that series are entitled to vote as a
separate voting group on the proposed amendment.
(3) If a proposed amendment that entitles
two or more series of shares to vote as separate voting groups under this
section would affect those two or more series in the same or a substantially
similar way, the shares of all the series so affected must vote together as a
single voting group on the proposed amendment.
(4) A class or series is entitled to the
voting rights granted by this section although the articles of incorporation
provide that the shares are nonvoting shares. [1987 c.52 §106]
60.444
Amendment before issuance of shares. If a corporation has not yet issued shares, its incorporators or the
board of directors may adopt one or more amendments to the corporations
articles of incorporation. If any such amendment relates to the duration,
purposes, authorized capital, rights or preferences of shares or internal
affairs, the incorporators or board of directors shall immediately notify in
writing each person who is a party to any agreement for the subscription of
stock of the corporation. Such notice shall set forth the text of the amendment
and state that the subscriber may, within 30 days after delivery or mailing of
the notice of amendment, rescind the subscription by notice in writing
delivered or mailed to the incorporators or board of directors at an address
specified. If a notice of rescission is not delivered or mailed within 30 days,
the subscriber may not thereafter assert the fact of the amendment as the basis
for avoiding the subscription agreement or asserting any claim against any
person. [1987 c.52 §107]
60.447
Articles of amendment. (1) A
corporation amending its articles of incorporation shall deliver articles of
amendment to the office for filing.
(2) Articles of amendment shall contain:
(a) The name of the corporation;
(b) The text of each amendment adopted;
(c) If an amendment provides for an
exchange, reclassification or cancellation of issued shares, provisions for
implementing the amendment if not contained in the amendment itself;
(d) The date of each amendments adoption;
(e) If an amendment was adopted by the
incorporators or board of directors without shareholder action, a statement to
that effect and a statement that shareholder action was not required; and
(f) If an amendment was approved by the
shareholders:
(A) The designation, number of outstanding
shares, number of votes entitled to be cast by each voting group entitled to
vote separately on the amendment; and
(B) The total number of votes cast for and
against the amendment by each voting group entitled to vote separately on the
amendment. [1987 c.52 §108]
60.451
Restated articles of incorporation. (1) A corporations board of directors may restate its articles of
incorporation at any time with or without shareholder action. If a corporation
has not yet issued shares, its incorporators or the board of directors may
adopt restated articles of incorporation, subject to the requirements of ORS
60.444.
(2) The restatement may include one or
more amendments to the articles. If the restatement includes an amendment
requiring shareholder approval, it must be adopted as provided in ORS 60.437.
(3) If the board of directors submits a
restatement for shareholder action, the corporation shall notify each
shareholder, whether or not entitled to vote, of the proposed shareholders
meeting in accordance with ORS 60.214. The notice must also state that the
purpose, or one of the purposes, of the meeting is to consider the proposed
restatement and contain or be accompanied by a copy of the restatement that
identifies any amendment or other change it would make in the articles.
(4) A corporation restating its articles
of incorporation shall deliver to the office for filing articles of restatement
setting forth the name of the corporation and the text of the restated articles
of incorporation together with a certificate setting forth:
(a) Whether the restatement contains an
amendment to the articles requiring shareholder approval and, if it does not,
that the board of directors adopted the restatement; or
(b) If the restatement contains an
amendment to the articles requiring shareholder approval, the information
required by ORS 60.447.
(5) Restated articles of incorporation
shall contain all statements required to be included in original articles of
incorporation except that no statement is required to be made with respect to:
(a) The names and addresses of the
incorporators or the initial or present registered office or agent; or
(b) The mailing address of the corporation
if an annual report has been filed with the office of the Secretary of State.
(6) Duly adopted restated articles of
incorporation supersede the original articles of incorporation and all amendments
to them.
(7) The Secretary of State may certify
restated articles of incorporation, as the articles of incorporation currently
in effect, without including the certificate information required by subsection
(4) of this section. [1987 c.52 §109; 1989 c.1040 §25]
60.454
Amendment pursuant to reorganization. (1) A corporations articles of incorporation may be amended without
action by the board of directors or shareholders to carry out a plan of
reorganization ordered or decreed by a court of competent jurisdiction under
federal statute if the articles of incorporation after amendment contain only
provisions required or permitted by ORS 60.047.
(2) The individual or individuals
designated by the court shall deliver to the office for filing articles of
amendment setting forth:
(a) The name of the corporation;
(b) The text of each amendment approved by
the court;
(c) The date of the courts order or
decree approving the articles of amendment;
(d) The title of the reorganization
proceeding in which the order or decree was entered; and
(e) A statement that the court had
jurisdiction of the proceeding under federal statute.
(3) Shareholders of a corporation
undergoing reorganization do not have dissenters rights except as and to the
extent provided in the reorganization plan.
(4) This section does not apply after
entry of a final decree in the reorganization proceeding even though the court
retains jurisdiction of the proceeding for limited purposes unrelated to
consummation of the reorganization plan. [1987 c.52 §110]
60.457
Effect of amendment. An
amendment to articles of incorporation does not affect a cause of action
existing against or in favor of the corporation, a proceeding to which the
corporation is a party or the existing rights of persons other than
shareholders of the corporation. An amendment changing a corporations name
does not abate a proceeding brought by or against the corporation in its former
name. [1987 c.52 §111]
(Amendment of
Bylaws)
60.461
Amendment or repeal by board of directors or shareholders. (1) A corporations board of directors may
amend or repeal the corporations bylaws unless:
(a) The articles of incorporation or this
chapter reserve this power exclusively to the shareholders in whole or in part;
or
(b) The shareholders in amending or
repealing a particular bylaw provide expressly that the board of directors may
not amend or repeal that bylaw.
(2) A corporations shareholders may amend
or repeal the corporations bylaws even though the bylaws may also be amended
or repealed by its board of directors. [1987 c.52 §112]
60.464
Bylaw increasing quorum or voting requirement for shareholders. (1) If expressly authorized by the articles
of incorporation, the shareholders may adopt or amend a bylaw that fixes a
greater quorum or voting requirement for shareholders, or voting groups of
shareholders, than is required by this chapter. The adoption or amendment of a
bylaw that adds, changes or deletes a greater quorum or voting requirement for
shareholders must meet the same quorum requirement and be adopted by the same
vote and voting groups required to take action under the quorum and voting
requirement then in effect or the quorum and voting requirement proposed to be
adopted, whichever is greater.
(2) A bylaw that fixes a greater quorum or
voting requirement for shareholders under subsection (1) of this section may
not be adopted, amended or repealed by the board of directors. [1987 c.52 §113]
60.467
Bylaw increasing quorum or voting requirement for directors. (1) A bylaw provision that fixes a greater
quorum or voting requirement for the board of directors may be amended or
repealed:
(a) If the provision was originally
adopted by the shareholders, only by the shareholders; or
(b) If the provision was originally adopted
by the board of directors, either by the shareholders or by the board of
directors.
(2) A bylaw provision adopted or amended
by the shareholders that fixes a greater quorum or voting requirement for the
board of directors may provide that it may be amended or repealed only by a
specified vote of either the shareholders or the board of directors. [1987 c.52
§114; 1989 c.1040 §26]
CONVERSION,
MERGER AND SHARE EXCHANGE
60.470
Definitions for ORS 60.470 to 60.501. As used in ORS 60.470 to 60.501:
(1) Business entity means:
(a) Any of the following for-profit
entities:
(A) A professional corporation organized
under ORS chapter 58, predecessor law or comparable law of another
jurisdiction;
(B) A corporation organized under this
chapter, predecessor law or comparable law of another jurisdiction;
(C) A limited liability company organized
under ORS chapter 63 or comparable law of another jurisdiction;
(D) A partnership organized in Oregon
after January 1, 1998, or that is registered as a limited liability
partnership, or that has elected to be governed by ORS chapter 67, and a
partnership governed by law of another jurisdiction that expressly provides for
conversions and mergers; and
(E) A limited partnership organized under
ORS chapter 70, predecessor law or comparable law of another jurisdiction; and
(b) A cooperative organized under ORS
chapter 62, predecessor law or comparable law of another jurisdiction.
(2) Organizational document means the
following for an
(a) In the case of a corporation,
professional corporation or cooperative, articles of incorporation;
(b) In the case of a limited liability
company, articles of organization;
(c) In the case of a partnership, a
partnership agreement and, for a limited liability partnership, its
registration; and
(d) In the case of a limited partnership,
a certificate of limited partnership.
(3) Owner means a:
(a) Shareholder of a corporation or of a
professional corporation;
(b) Member or shareholder of a
cooperative;
(c) Member of a limited liability company;
(d) Partner of a partnership; and
(e) General partner or limited partner of
a limited partnership. [1999 c.362 §6; 2003 c.80 §14]
60.472
Conversion. (1) A business
entity other than a corporation may be converted to a corporation organized
under this chapter, and a corporation organized under this chapter may be
converted to another business entity organized under the laws of this state, if
conversion is permitted by the statutes governing the other business entity, by
approving a plan of conversion and filing articles of conversion. A corporation
organized under this chapter may be converted to a business entity organized
under the laws of another jurisdiction if:
(a) The conversion is permitted by the
laws of that jurisdiction;
(b) A plan of conversion is approved by
the converting corporation;
(c) Articles of conversion are filed in
this state;
(d) The converted business entity submits
an application to transact business as a foreign business entity of that type
to the Secretary of State for filing and meets all other requirements
prescribed under the laws of this state for authorization to transact business
as a foreign business entity of that type; and
(e) The corporation complies with all
requirements imposed under the laws of the other jurisdiction with respect to
the conversion.
(2) The plan of conversion shall set
forth:
(a) The name and type of the business
entity prior to conversion;
(b) The name and type of the business
entity after conversion;
(c) A summary of the material terms and
conditions of the conversion;
(d) The manner and basis of converting the
ownership interests of each owner into ownership interests or obligations of
the converted business entity or any other business entity, or into cash or
other property in whole or in part; and
(e) Any additional information required in
the organizational document of the converted business entity by the statutes
governing that type of business entity.
(3) The plan of conversion may set forth
other provisions relating to the conversion. [1999 c.362 §7; 2001 c.315 §12;
2003 c.80 §15]
60.474
Action on plan of conversion.
(1) A plan of conversion shall be approved as follows:
(a) In the case of a corporation, in the
manner provided in ORS 60.487 for mergers; and
(b) In the case of a business entity other
than a corporation, as provided by the statutes governing that business entity.
(2) After a conversion is approved, and at
any time before articles of conversion are filed, the planned conversion may be
abandoned, subject to any contractual rights:
(a) By a corporation, in the manner
provided in ORS 60.487 (9); and
(b) By a business entity that planned to
convert to a corporation, in accordance with the procedure set forth in the
plan of conversion or, if none is set forth, in the manner permitted by the
statutes governing that business entity. [1999 c.362 §8]
60.476
Articles of conversion. (1)
After conversion is approved by the owners, the converting business entity
shall file articles of conversion, which shall state the name and type of
business entity prior to conversion and the name and type of business entity
after conversion, and shall include the plan of conversion.
(2) The conversion takes effect at the
later of the date and time determined pursuant to ORS 60.011 or the date and
time determined pursuant to the statutes governing the business entity that is
not a corporation. [1999 c.362 §9; 2001 c.315 §7]
60.478
Effect of conversion; assumed business name. (1) When a conversion to or from a corporation pursuant to ORS 60.472
takes effect:
(a) The business entity continues its
existence despite the conversion;
(b) Title to all real estate and other
property owned by the converting business entity is vested in the converted
business entity without reversion or impairment;
(c) All obligations of the converting
business entity, including, without limitation, contractual, tort, statutory
and administrative obligations, are obligations of the converted business
entity;
(d) An action or proceeding pending
against the converting business entity or its owners may be continued as if the
conversion had not occurred, or the converted business entity may be
substituted as a party to the action or proceeding;
(e) The ownership interests of each owner
that are to be converted into ownership interests or obligations of the
converted business entity or any other business entity, or into cash or other
property, are converted as provided in the plan of conversion;
(f) Liability of an owner for obligations
of the business entity, including, without limitation, contractual, tort,
statutory and administrative obligations, shall be determined:
(A) As to liabilities incurred prior to conversion,
according to the laws applicable prior to conversion; and
(B) As to liabilities incurred after
conversion, according to the laws applicable after conversion, except as
provided in paragraph (g) of this subsection;
(g) If prior to conversion an owner of a
business entity was a partner of a partnership or general partner of a limited
partnership and was personally liable for the business entitys liabilities,
and after conversion is an owner normally protected from personal liability,
then such owner shall continue to be personally liable for the business entitys
liabilities incurred during the 12 months following conversion, if the other
party or parties to the transaction reasonably believed that the owner would be
personally liable and had not received notice of the conversion; and
(h) Unless the converted business entity
is a partnership, the registration of an assumed business name of a business
entity pursuant to ORS chapter 648 shall continue as the assumed business name
of the converted business entity. If the converted business entity is a
partnership, the converting business entity shall amend or cancel the
registration of the assumed business name under ORS chapter 648, and the
partners of the partnership shall register the name as an assumed business name
under ORS chapter 648.
(2) Owners of the business entity that
converted are entitled to the rights provided in the plan of conversion and:
(a) In the case of shareholders of a
corporation, the right to dissent and obtain payment of the fair value of the
shareholders shares as provided in ORS 60.551 to 60.594; and
(b) In the case of owners of business
entities other than corporations, the rights provided in the statutes, common
law and private agreements applicable to the business entity prior to
conversion, including, without limitation, any rights to dissent, to
dissociate, to withdraw, to recover for breach of any duty or obligation owed
by the other owners, and to obtain an appraisal or payment for the value of an
owners interest. [1999 c.362 §10; 2001 c.315 §2]
60.481
Merger. (1)(a) One or more
business entities may merge into a corporation organized under this chapter if
the merger is permitted by the statutes governing each other business entity
that is a party to the merger, a plan of merger is approved by each business
entity that is a party to the merger and articles of merger are filed. A
corporation organized under this chapter may be merged into a business entity
organized under the laws of this state or under the laws of another
jurisdiction, other than a foreign corporation, if:
(A) The merger is permitted by the laws of
this state or by the laws of the other jurisdiction that govern the other
business entity;
(B) A plan of merger is approved by each
business entity that is a party to the merger;
(C) Articles of merger are filed in this
state; and
(D) The corporation complies with all
requirements imposed under the laws of this state and, if applicable, the laws
of the other jurisdiction with respect to the merger.
(b) A merger of one or more domestic
corporations with one or more foreign corporations is governed by ORS 60.501.
(2) The plan of merger shall set forth:
(a) The name and type of each business
entity planning to merge;
(b) The name and type of the business
entity that will survive;
(c) A summary of the material terms and
conditions of the merger;
(d) The manner and basis of converting the
shares or other ownership interests of each owner into shares, ownership
interests or obligations of the surviving business entity or any other business
entity, or into cash or other property in whole or in part; and
(e) If any party is a business entity
other than a corporation, any additional information required for a merger by
the statutes governing that business entity.
(3) The plan of merger may set forth:
(a) Amendments to the articles of
incorporation of a corporation, if the corporation is the surviving business
entity; and
(b) Other provisions relating to the
merger.
(4) One or more corporations may merge
with a nonprofit corporation under ORS 65.481 to 65.504. [1987 c.52 §115; 1989
c.1010 §176; 1991 c.883 §9; 1999 c.362 §11; 2001 c.315 §13; 2003 c.80 §16]
60.484
Share exchange. (1) A
corporation may acquire all of the outstanding shares of one or more classes or
series of another corporation if the board of directors of each corporation
adopts a plan of exchange and, if required by ORS 60.487, the shareholders of
each corporation approve the exchange.
(2) The plan of exchange must set forth:
(a) The name of the corporation whose
shares will be acquired and the name of the acquiring corporation;
(b) A summary of the material terms and
conditions of the exchange; and
(c) The manner and basis of exchanging the
shares to be acquired for shares, obligations, or other securities of the
acquiring or any other corporation or for cash or for other property in full or
part.
(3) The plan of exchange may set forth
other provisions relating to the exchange.
(4) This section does not limit the power
of a corporation to acquire all or part of the shares of one or more classes or
series of another corporation through a voluntary exchange or otherwise. [1987
c.52 §116; 1989 c.171 §7; 1989 c.1040 §27; 2003 c.80 §17]
60.487
Action on plan of merger or share exchange. (1) After adopting a plan of merger or share exchange, the board of
directors of each corporation party to the merger and the board of directors of
the corporation whose shares will be acquired in the share exchange, shall
submit the plan of merger, except as provided in subsection (7) of this
section, or share exchange for approval by its shareholders.
(2) For a plan of merger or share exchange
to be approved:
(a) The board of directors shall direct by
resolution that the plan of merger or share exchange be submitted to a vote at
a meeting of shareholders, which may be either an annual or a special meeting;
and
(b) The shareholders entitled to vote must
approve the plan.
(3) The board of directors may condition
its submission of the proposed merger or share exchange on any basis.
(4) The corporation shall notify each
shareholder, whether or not entitled to vote, of the proposed shareholders
meeting in accordance with ORS 60.214. The notice must also state that the
purpose, or one of the purposes, of the meeting is to consider the plan of
merger or share exchange and contain or be accompanied by a copy or summary of
the plan.
(5) Unless this chapter, the articles of
incorporation or the board of directors, acting pursuant to subsection (3) of
this section, requires a greater vote or a vote by voting groups, the plan of
merger or share exchange to be authorized shall be approved by each voting
group entitled to vote separately on the plan by a majority of all the votes
entitled to be cast on the plan by that voting group.
(6) Separate voting by voting groups is
required:
(a) On a plan of merger if the plan
contains a provision that, if contained in a proposed amendment to articles of
incorporation, would require action by one or more separate voting groups on
the proposed amendment under ORS 60.441, except that separate voting by a
voting group is not required if:
(A) Under the plan of merger, the shares
that constitute the voting group are to be converted into shares, obligations,
other securities, cash or other property with a value at least equal to the
value the shares would receive in a liquidation of the corporation. For
purposes of determining the value the shares would receive in a liquidation of
the corporation, the value of property available for distribution to all
shareholders in the liquidation shall be assumed to be equal to the total value
of shares, obligations, other securities, cash or other property into which all
shares of the corporation are to be converted under the plan of merger; or
(B) The articles of incorporation provide
that the voting group is not entitled to vote separately on a plan of merger;
and
(b) On a plan of share exchange by each
class or series of shares included in the exchange, with each class or series
constituting a separate voting group.
(7) Action by the shareholders of the
surviving corporation on a plan of merger is not required if:
(a) The articles of incorporation of the
surviving corporation will not differ, except for amendments enumerated in ORS
60.434, from its articles before the merger;
(b) Each shareholder of the surviving
corporation whose shares were outstanding immediately before the effective date
of the merger will hold the same number of shares, with identical designations,
preferences, limitations and relative rights, immediately after;
(c) The number of voting shares
outstanding immediately after the merger, plus the number of voting shares
issuable as a result of the merger, either by the conversion of securities
issued pursuant to the merger or the exercise of rights and warrants issued
pursuant to the merger, will not exceed by more than 20 percent the total
number of voting shares of the surviving corporation outstanding immediately
before the merger; and
(d) The number of participating shares
outstanding immediately after the merger, plus the number of participating
shares issuable as a result of the merger, either by the conversion of
securities issued pursuant to the merger or the exercise of rights and warrants
issued pursuant to the merger, will not exceed by more than 20 percent the
total number of participating shares outstanding immediately before the merger.
(8) As used in subsection (7) of this
section:
(a) Participating shares means shares
that entitle their holders to participate without limitation in distributions.
(b) Voting shares means shares that
entitle their holders to vote unconditionally in elections of directors.
(9) After a merger or share exchange is
authorized, and at any time before articles of merger or share exchange are
filed, the planned merger or share exchange may be abandoned, subject to any
contractual rights, without further shareholder action, in accordance with the
procedure set forth in the plan of merger or share exchange or, if none is set
forth, in the manner determined by the board of directors.
(10) If a party to a plan of merger is a
business entity other than a corporation, approval of the plan, and abandonment
of the plan after approval, shall be in accordance with the statutes governing
that business entity. [1987 c.52 §117; 1989 c.1040 §28; 1991 c.883 §10; 1993
c.403 §7; 1999 c.362 §12]
60.491
Merger with subsidiary. (1)
A parent corporation owning at least 90 percent of the outstanding shares of
each class of a subsidiary corporation may merge the subsidiary into itself, or
may merge itself into the subsidiary, without approval of the shareholders of
the parent or subsidiary.
(2) If the parent will be the surviving
corporation:
(a) The board of directors of the parent
shall adopt a plan of merger that sets forth:
(A) The names of the parent and
subsidiary; and
(B) The manner and basis of converting the
shares of the subsidiary into shares, obligations or other securities of the
parent or any other corporation or into cash or other property in whole or
part, or of canceling any part of the shares;
(b) The parent shall mail a copy or
summary of the plan of merger to each shareholder of the subsidiary who does
not waive the mailing requirement in writing;
(c) The parent may not deliver the
articles of merger to the office for filing until at least 30 days after the
date the parent mailed a copy of the plan of merger to each shareholder of the
subsidiary who did not waive the mailing requirement; and
(d) Articles of merger under this subsection
may not contain amendments to the articles of incorporation of the parent
corporation, except for amendments listed in ORS 60.434.
(3) If the parent will not be the
surviving corporation:
(a) The board of directors of the parent
shall adopt a plan of merger that sets forth:
(A) The names of the parent and
subsidiary;
(B) The manner and basis of converting the
shares of the parent into shares of the surviving corporation, which shall
ensure that each shareholder of the parent immediately before the merger takes
effect will immediately thereafter:
(i) Hold the same percentage of the total
of each class of shares of the surviving corporation owned by former
shareholders of the parent as the shareholder held in each class of shares of
the parent; and
(ii) Hold shares of the surviving
corporation having the same rights, preferences, privileges and restrictions as
the shares of the parent held by such shareholder immediately before the merger
takes effect;
(C) Amendments to the articles of incorporation
of the surviving corporation so that the articles are identical to the articles
of incorporation of the parent in effect immediately before the merger takes
effect, except for amendments to the articles of incorporation of the parent
listed in ORS 60.434; and
(D) Provisions relating to the outstanding
shares of the subsidiary including cancellation of the shares held by the
parent. If under the plan of merger the shareholders of the subsidiary other
than the parent will not be shareholders of the surviving corporation, the plan
shall also set forth the manner and basis of converting the shares of the
subsidiary held by such shareholders into obligations or other securities of
the surviving corporation or shares, obligations or other securities of any
other corporation or into cash or other property in whole or in part;
(b) The parent shall mail a copy or
summary of the plan of merger to each shareholder of the subsidiary who does
not waive the mailing requirement in writing;
(c) The parent may not deliver the
articles of merger to the office for filing until at least 30 days after the
date the parent mailed a copy or summary of the plan of merger to each
shareholder of the subsidiary who did not waive the mailing requirement; and
(d) The surviving corporation shall be a
domestic corporation. [1987 c.52 §118; 1993 c.403 §8; 1997 c.392 §1]
60.494
Articles of merger or share exchange. (1) After a plan of merger or share exchange is approved by the owners
of each business entity, or adopted by a board of directors if shareholder
approval is not required, the surviving or acquiring business entity shall
deliver to the office of the Secretary of State, for filing, articles of merger
or articles of share exchange setting forth:
(a) The plan of merger or share exchange;
(b) For each corporation that is a party
to the merger or share exchange:
(A) If shareholder approval was not
required, a statement to that effect; or
(B) If shareholder approval was required:
(i) The designation, number of outstanding
shares and number of votes entitled to be cast by each voting group entitled to
vote separately on the plan as to each corporation; and
(ii) The total number of votes cast for
and against the plan by each voting group entitled to vote separately on the
plan; and
(c) For each business entity other than a
corporation that is a party to the merger, a statement that the plan of merger
was duly authorized and approved in accordance with the statutes governing that
business entity.
(2) The merger or share exchange takes
effect on the later of the date and time determined pursuant to ORS 60.011 or
the date and time determined pursuant to the statutes governing any business
entity other than a corporation that is a party to the merger. [1987 c.52 §119;
1999 c.362 §13; 2001 c.104 §18; 2001 c.315 §1]
60.497
Effect of merger or share exchange. (1) When a merger involving a corporation takes effect:
(a) Every other business entity that is a
party to the merger merges into the surviving business entity, and the separate
existence of every other party ceases;
(b) Title to all real estate and other
property owned by each of the business entities that were parties to the merger
is vested in the surviving business entity without reversion or impairment;
(c) All obligations of each of the
business entities that were parties to the merger, including, without
limitation, contractual, tort, statutory and administrative obligations, are
obligations of the surviving business entity;
(d) An action or proceeding pending
against each of the business entities or its owners that were parties to the
merger may be continued as if the merger had not occurred, or the surviving
business entity may be substituted as a party to the action or proceeding;
(e) If a corporation is the surviving
business entity, its articles of incorporation are amended to the extent
provided in the plan of merger;
(f) The shares or other ownership
interests of each owner that are to be converted into ownership interests or
obligations of the surviving business entity or any other business entity, or
into cash or other property, are converted as provided in the plan of merger;
(g) Liability of an owner for obligations
of the business entity, including, without limitation, contractual, tort,
statutory and administrative obligations, shall be determined:
(A) As to obligations incurred prior to
merger, according to the laws applicable prior to merger; and
(B) As to obligations incurred after
merger, according to the laws applicable after merger, except as provided in
paragraph (h) of this subsection;
(h) If prior to merger an owner of a
business entity was a partner of a partnership or general partner of a limited
partnership and was personally liable for the business entitys obligations,
and after merger is an owner normally protected from personal liability, then
such owner shall continue to be personally liable for the business entitys
obligations incurred during the 12 months following merger, if the other party
or parties to the transaction reasonably believed that the owner would be
personally liable and had not received notice of the merger; and
(i) The registration of an assumed
business name of a business entity pursuant to ORS chapter 648 shall continue
as the assumed business name of the surviving business entity.
(2) Owners of the business entities that
merged are entitled to the rights provided in the plan of merger and:
(a) In the case of shareholders, the
rights provided in this chapter; and
(b) In the case of owners of business
entities other than corporations, the rights provided in the statutes
applicable to that business entity, including, without limitation, any rights
to dissent, to dissociate, to withdraw, to recover for breach of any duty or
obligation owed by the other owners, and to obtain an appraisal or payment for
the value of an owners interest.
(3) When a share exchange takes effect,
the shares of each acquired corporation are exchanged as provided in the plan,
and the former holders of the shares are entitled only to the exchange rights
provided in the articles of share exchange or to their rights under this
chapter. [1987 c.52 §120; 1999 c.362 §14; 2001 c.104 §19]
60.501
Merger or share exchange with foreign corporation. (1) One or more foreign corporations may
merge or enter into a share exchange with one or more domestic corporations if:
(a) In a merger, the merger is permitted
by the law of the state or country under whose law each foreign corporation is
incorporated and each foreign corporation complied with that law in effecting
the merger;
(b) In a share exchange, the corporation
whose shares will be acquired is a domestic corporation, whether or not a share
exchange is permitted by the law of the state or country under whose law the
acquiring corporation is incorporated;
(c) The foreign corporation complies with
ORS 60.494 if it is the surviving corporation of the merger or acquiring
corporation of the share exchange; and
(d) Each domestic corporation complies
with the applicable provisions of ORS 60.481 to 60.491 and, if it is the
surviving corporation of the merger or acquiring corporation of the share
exchange, with ORS 60.481 to 60.494.
(2) Upon the merger or share exchange
taking effect, the surviving foreign corporation of a merger and the acquiring
foreign corporation of a share exchange is deemed:
(a) To appoint the Secretary of State as
its agent for service of process in a proceeding to enforce any obligation or
the rights of dissenting shareholders of each domestic corporation party to the
merger or share exchange; and
(b) To agree that it will promptly pay to
the dissenting shareholders of each domestic corporation party to the merger or
share exchange the amount, if any, to which they are entitled under this
chapter.
(3) This section does not limit the power
of a foreign corporation to acquire all or part of the shares of one or more
classes or series of a domestic corporation through a voluntary exchange or
otherwise. [1987 c.52 §121]
60.531
(a) Sell, lease, exchange or otherwise
dispose of all or substantially all of its property in the usual and regular
course of business;
(b) Mortgage, pledge, dedicate to the
repayment of indebtedness, whether with or without recourse, or otherwise
encumber any or all of its property whether or not in the usual and regular
course of business; or
(c) Transfer any or all of its property to
a corporation all the shares of which are owned by the corporation.
(2) Unless required by the articles of
incorporation, approval by the shareholders of a transaction described in
subsection (1) of this section is not required. [1987 c.52 §122]
60.534
(2) For a transaction to be authorized:
(a) The board of directors shall adopt a
resolution directing that such sale, lease, exchange or other disposition be
submitted to a vote at a meeting of shareholders, which may be either an annual
or a special meeting; and
(b) The shareholders entitled to vote must
approve the transaction.
(3) The board of directors may condition
its submission of the proposed transaction on any basis.
(4) The corporation shall notify each
shareholder, whether or not entitled to vote, of the proposed shareholders
meeting in accordance with ORS 60.214. The notice must also state that the
purpose, or one of the purposes, of the meeting is to consider the sale, lease,
exchange or other disposition of all or substantially all the property of the
corporation and contain or be accompanied by a description of the transaction.
(5) Unless the articles of incorporation
or the board of directors, acting pursuant to subsection (3) of this section,
require a greater vote or a vote by voting groups, the transaction to be
authorized must be approved by a majority of all the votes entitled to be cast
on the transaction.
(6) After a sale, lease, exchange or other
disposition of property is authorized, the transaction may be abandoned,
subject to any contractual rights, without further shareholder action.
(7) A transaction that constitutes a
distribution is governed by ORS 60.181 and not by this section. [1987 c.52 §123;
1989 c.1040 §29]
DISSENTERS
RIGHTS
(Right to
Dissent and Obtain Payment for Shares)
60.551
Definitions for ORS 60.551 to 60.594. As used in ORS 60.551 to 60.594:
(1) Beneficial shareholder means the
person who is a beneficial owner of shares held in a voting trust or by a
nominee as the record shareholder.
(2) Corporation means the issuer of the
shares held by a dissenter before the corporate action, or the surviving or
acquiring corporation by merger or share exchange of that issuer.
(3) Dissenter means a shareholder who is
entitled to dissent from corporate action under ORS 60.554 and who exercises
that right when and in the manner required by ORS 60.561 to 60.587.
(4) Fair value, with respect to a
dissenters shares, means the value of the shares immediately before the
effectuation of the corporate action to which the dissenter objects, excluding
any appreciation or depreciation in anticipation of the corporate action unless
exclusion would be inequitable.
(5) Interest means interest from the
effective date of the corporate action until the date of payment, at the
average rate currently paid by the corporation on its principal bank loans or,
if none, at a rate that is fair and equitable under all the circumstances.
(6) Record shareholder means the person
in whose name shares are registered in the records of a corporation or the
beneficial owner of shares to the extent of the rights granted by a nominee
certificate on file with a corporation.
(7) Shareholder means the record
shareholder or the beneficial shareholder. [1987 c.52 §124; 1989 c.1040 §30]
60.554
Right to dissent. (1)
Subject to subsection (2) of this section, a shareholder is entitled to dissent
from, and obtain payment of the fair value of the shareholders shares in the
event of, any of the following corporate acts:
(a) Consummation of a plan of merger to
which the corporation is a party if shareholder approval is required for the
merger by ORS 60.487 or the articles of incorporation and the shareholder is
entitled to vote on the merger or if the corporation is a subsidiary that is
merged with its parent under ORS 60.491;
(b) Consummation of a plan of share
exchange to which the corporation is a party as the corporation whose shares
will be acquired, if the shareholder is entitled to vote on the plan;
(c) Consummation of a sale or exchange of
all or substantially all of the property of the corporation other than in the
usual and regular course of business, if the shareholder is entitled to vote on
the sale or exchange, including a sale in dissolution, but not including a sale
pursuant to court order or a sale for cash pursuant to a plan by which all or
substantially all of the net proceeds of the sale will be distributed to the
shareholders within one year after the date of sale;
(d) An amendment of the articles of
incorporation that materially and adversely affects rights in respect of a
dissenters shares because it:
(A) Alters or abolishes a preemptive right
of the holder of the shares to acquire shares or other securities; or
(B) Reduces the number of shares owned by
the shareholder to a fraction of a share if the fractional share so created is
to be acquired for cash under ORS 60.141;
(e) Any corporate action taken pursuant to
a shareholder vote to the extent the articles of incorporation, bylaws or a
resolution of the board of directors provides that voting or nonvoting
shareholders are entitled to dissent and obtain payment for their shares; or
(f) Conversion to a noncorporate business
entity pursuant to ORS 60.472.
(2) A shareholder entitled to dissent and
obtain payment for the shareholders shares under ORS 60.551 to 60.594 may not
challenge the corporate action creating the shareholders entitlement unless
the action is unlawful or fraudulent with respect to the shareholder or the
corporation.
(3) Dissenters rights shall not apply to
the holders of shares of any class or series if the shares of the class or
series were registered on a national securities exchange or quoted on the
National Association of Securities Dealers, Inc. Automated Quotation System as
a National Market System issue on the record date for the meeting of shareholders
at which the corporate action described in subsection (1) of this section is to
be approved or on the date a copy or summary of the plan of merger is mailed to
shareholders under ORS 60.491, unless the articles of incorporation otherwise
provide. [1987 c.52 §125; 1989 c.1040 §31; 1993 c.403 §9; 1999 c.362 §15]
60.557
Dissent by nominees and beneficial owners. (1) A record shareholder may assert dissenters rights as to fewer
than all the shares registered in the shareholders name only if the
shareholder dissents with respect to all shares beneficially owned by any one
person and notifies the corporation in writing of the name and address of each
person on whose behalf the shareholder asserts dissenters rights. The rights
of a partial dissenter under this subsection are determined as if the shares
regarding which the shareholder dissents and the shareholders other shares
were registered in the names of different shareholders.
(2) A beneficial shareholder may assert
dissenters rights as to shares held on the beneficial shareholders behalf
only if:
(a) The beneficial shareholder submits to
the corporation the record shareholders written consent to the dissent not
later than the time the beneficial shareholder asserts dissenters rights; and
(b) The beneficial shareholder does so
with respect to all shares of which such shareholder is the beneficial
shareholder or over which such shareholder has power to direct the vote. [1987
c.52 §126]
(Procedure
for Exercise of Rights)
60.561
Notice of dissenters rights.
(1) If proposed corporate action creating dissenters rights under ORS 60.554
is submitted to a vote at a shareholders meeting, the meeting notice must
state that shareholders are or may be entitled to assert dissenters rights
under ORS 60.551 to 60.594 and be accompanied by a copy of ORS 60.551 to
60.594.
(2) If corporate action creating
dissenters rights under ORS 60.554 is taken without a vote of shareholders,
the corporation shall notify in writing all shareholders entitled to assert
dissenters rights that the action was taken and send the shareholders entitled
to assert dissenters rights the dissenters notice described in ORS 60.567. [1987
c.52 §127]
60.564
Notice of intent to demand payment. (1) If proposed corporate action creating dissenters rights under ORS
60.554 is submitted to a vote at a shareholders meeting, a shareholder who
wishes to assert dissenters rights shall deliver to the corporation before the
vote is taken written notice of the shareholders intent to demand payment for
the shareholders shares if the proposed action is effectuated and shall not
vote such shares in favor of the proposed action.
(2) A shareholder who does not satisfy the
requirements of subsection (1) of this section is not entitled to payment for
the shareholders shares under this chapter. [1987 c.52 §128]
60.567
Dissenters notice. (1) If
proposed corporate action creating dissenters rights under ORS 60.554 is
authorized at a shareholders meeting, the corporation shall deliver a written
dissenters notice to all shareholders who satisfied the requirements of ORS
60.564.
(2) The dissenters notice shall be sent
no later than 10 days after the corporate action was taken, and shall:
(a) State where the payment demand shall
be sent and where and when certificates for certificated shares shall be
deposited;
(b) Inform holders of uncertificated
shares to what extent transfer of the shares will be restricted after the
payment demand is received;
(c) Supply a form for demanding payment that
includes the date of the first announcement of the terms of the proposed
corporate action to news media or to shareholders and requires that the person
asserting dissenters rights certify whether or not the person acquired
beneficial ownership of the shares before that date;
(d) Set a date by which the corporation
must receive the payment demand. This date may not be fewer than 30 nor more
than 60 days after the date the subsection (1) of this section notice is
delivered; and
(e) Be accompanied by a copy of ORS 60.551
to 60.594. [1987 c.52 §129]
60.571
Duty to demand payment. (1)
A shareholder sent a dissenters notice described in ORS 60.567 must demand
payment, certify whether the shareholder acquired beneficial ownership of the
shares before the date required to be set forth in the dissenters notice
pursuant to ORS 60.567 (2)(c), and deposit the shareholders certificates in
accordance with the terms of the notice.
(2) The shareholder who demands payment
and deposits the shareholders shares under subsection (1) of this section
retains all other rights of a shareholder until these rights are canceled or
modified by the taking of the proposed corporate action.
(3) A shareholder who does not demand
payment or deposit the shareholders share certificates where required, each by
the date set in the dissenters notice, is not entitled to payment for the
shareholders shares under this chapter. [1987 c.52 §130]
60.574
Share restrictions. (1) The
corporation may restrict the transfer of uncertificated shares from the date
the demand for their payment is received until the proposed corporate action is
taken or the restrictions released under ORS 60.581.
(2) The person for whom dissenters rights
are asserted as to uncertificated shares retains all other rights of a
shareholder until these rights are canceled or modified by the taking of the
proposed corporate action. [1987 c.52 §131]
60.577
Payment. (1) Except as
provided in ORS 60.584, as soon as the proposed corporate action is taken, or
upon receipt of a payment demand, the corporation shall pay each dissenter who
complied with ORS 60.571, the amount the corporation estimates to be the fair
value of the shareholders shares, plus accrued interest.
(2) The payment must be accompanied by:
(a) The corporations balance sheet as of
the end of a fiscal year ending not more than 16 months before the date of
payment, an income statement for that year and the latest available interim
financial statements, if any;
(b) A statement of the corporations estimate
of the fair value of the shares;
(c) An explanation of how the interest was
calculated;
(d) A statement of the dissenters right
to demand payment under ORS 60.587; and
(e) A copy of ORS 60.551 to 60.594. [1987
c.52 §132; 1987 c.579 §4]
60.581
Failure to take action. (1)
If the corporation does not take the proposed action within 60 days after the
date set for demanding payment and depositing share certificates, the
corporation shall return the deposited certificates and release the transfer
restrictions imposed on uncertificated shares.
(2) If after returning deposited
certificates and releasing transfer restrictions, the corporation takes the
proposed action, it must send a new dissenters notice under ORS 60.567 and
repeat the payment demand procedure. [1987 c.52 §133]
60.584
After-acquired shares. (1) A
corporation may elect to withhold payment required by ORS 60.577 from a
dissenter unless the dissenter was the beneficial owner of the shares before
the date set forth in the dissenters notice as the date of the first
announcement to news media or to shareholders of the terms of the proposed
corporate action.
(2) To the extent the corporation elects
to withhold payment under subsection (1) of this section, after taking the
proposed corporate action, it shall estimate the fair value of the shares plus
accrued interest and shall pay this amount to each dissenter who agrees to
accept it in full satisfaction of such demand. The corporation shall send with
its offer a statement of its estimate of the fair value of the shares an
explanation of how the interest was calculated and a statement of the dissenters
right to demand payment under ORS 60.587. [1987 c.52 §134]
60.587
Procedure if shareholder dissatisfied with payment or offer. (1) A dissenter may notify the corporation
in writing of the dissenters own estimate of the fair value of the dissenters
shares and amount of interest due, and demand payment of the dissenters
estimate, less any payment under ORS 60.577 or reject the corporations offer
under ORS 60.584 and demand payment of the dissenters estimate of the fair
value of the dissenters shares and interest due, if:
(a) The dissenter believes that the amount
paid under ORS 60.577 or offered under ORS 60.584 is less than the fair value of
the dissenters shares or that the interest due is incorrectly calculated;
(b) The corporation fails to make payment
under ORS 60.577 within 60 days after the date set for demanding payment; or
(c) The corporation, having failed to take
the proposed action, does not return the deposited certificates or release the
transfer restrictions imposed on uncertificated shares within 60 days after the
date set for demanding payment.
(2) A dissenter waives the right to demand
payment under this section unless the dissenter notifies the corporation of the
dissenters demand in writing under subsection (1) of this section within 30
days after the corporation made or offered payment for the dissenters shares. [1987
c.52 §135]
(Judicial
Appraisal of Shares)
60.591
Court action. (1) If a
demand for payment under ORS 60.587 remains unsettled, the corporation shall
commence a proceeding within 60 days after receiving the payment demand under
ORS 60.587 and petition the court under subsection (2) of this section to determine
the fair value of the shares and accrued interest. If the corporation does not
commence the proceeding within the 60-day period, it shall pay each dissenter
whose demand remains unsettled the amount demanded.
(2) The corporation shall commence the
proceeding in the circuit court of the county where a corporations principal
office is located, or if the principal office is not in this state, where the
corporations registered office is located. If the corporation is a foreign
corporation without a registered office in this state, it shall commence the
proceeding in the county in this state where the registered office of the
domestic corporation merged with or whose shares were acquired by the foreign
corporation was located.
(3) The corporation shall make all
dissenters, whether or not residents of this state, whose demands remain
unsettled parties to the proceeding as in an action against their shares. All
parties must be served with a copy of the petition. Nonresidents may be served
by registered or certified mail or by publication as provided by law.
(4) The jurisdiction of the circuit court
in which the proceeding is commenced under subsection (2) of this section is
plenary and exclusive. The court may appoint one or more persons as appraisers
to receive evidence and recommend decision on the question of fair value. The
appraisers have the powers described in the court order appointing them, or in
any amendment to the order. The dissenters are entitled to the same discovery
rights as parties in other civil proceedings.
(5) Each dissenter made a party to the
proceeding is entitled to judgment for:
(a) The amount, if any, by which the court
finds the fair value of the dissenters shares, plus interest, exceeds the
amount paid by the corporation; or
(b) The fair value, plus accrued interest,
of the dissenters after-acquired shares for which the corporation elected to
withhold payment under ORS 60.584. [1987 c.52 §136]
60.594
Court costs and counsel fees.
(1) The court in an appraisal proceeding commenced under ORS 60.591 shall
determine all costs of the proceeding, including the reasonable compensation
and expenses of appraisers appointed by the court. The court shall assess the
costs against the corporation, except that the court may assess costs against
all or some of the dissenters, in amounts the court finds equitable, to the
extent the court finds the dissenters acted arbitrarily, vexatiously, or not in
good faith in demanding payment under ORS 60.587.
(2) The court may also assess the fees and
expenses of counsel and experts of the respective parties in amounts the court
finds equitable:
(a) Against the corporation and in favor
of any or all dissenters if the court finds the corporation did not
substantially comply with the requirements of ORS 60.561 to 60.587; or
(b) Against either the corporation or a
dissenter, in favor of any other party, if the court finds that the party
against whom the fees and expenses are assessed acted arbitrarily, vexatiously
or not in good faith with respect to the rights provided by this chapter.
(3) If the court finds that the services
of counsel for any dissenter were of substantial benefit to other dissenters
similarly situated, and that the fees for those services should not be assessed
against the corporation, the court may award to counsel reasonable fees to be
paid out of the amount awarded the dissenters who were benefited. [1987 c.52 §137]
DISSOLUTION
(Voluntary
Dissolution)
60.621
Dissolution by incorporators or initial directors. (1) A majority of the incorporators or
initial directors of a corporation that has not issued shares and has not
commenced business may dissolve the corporation by delivering articles of
dissolution to the office for filing.
(2) Articles of dissolution shall set
forth:
(a) The name of the corporation;
(b) The date of its incorporation;
(c) That none of the corporations shares
has been issued and that the corporation has not commenced business;
(d) That no debt of the corporation
remains unpaid; and
(e) That a majority of the incorporators
or initial directors authorized the dissolution. [1987 c.52 §138; 1987 c.579 §5]
60.624
Voluntary dissolution by consent of shareholders. A corporation may be voluntarily dissolved
by the written consent of all of its shareholders. [1987 c.52 §139]
60.627
Dissolution by board of directors and shareholders. (1) A corporations board of directors may
propose dissolution for submission to the shareholders.
(2) For a proposal to dissolve to be
adopted:
(a) The board of directors must recommend
dissolution to the shareholders unless the board of directors determines that
because of conflict of interest or other special circumstances it should make
no recommendation and communicates the basis for its determination to the
shareholders; and
(b) The shareholders entitled to vote must
approve the proposal to dissolve as provided in subsection (5) of this section.
(3) The board of directors may condition
its submission of the proposal for dissolution on any basis.
(4) The corporation shall notify each
shareholder, whether or not entitled to vote, of the proposed shareholders
meeting in accordance with ORS 60.214. The notice must also state that the
purpose, or one of the purposes, of the meeting is to consider dissolving the
corporation.
(5) Unless the articles of incorporation
or the board of directors, acting pursuant to subsection (3) of this section,
require a greater vote or a vote by voting groups, the proposal to dissolve to
be adopted must be approved by a majority of all the votes entitled to be cast
on the proposal. [1987 c.52 §140]
60.631
Articles of dissolution. (1)
At any time after dissolution is authorized, the corporation may dissolve by
delivering to the office for filing articles of dissolution setting forth:
(a) The name of the corporation;
(b) The date dissolution was authorized;
(c) If dissolution was approved by the
shareholders:
(A) The number of votes entitled to be
cast on the proposal to dissolve; and
(B) The total number of votes cast for and
against dissolution and a statement that the number cast for dissolution was
sufficient for approval; and
(d) If voting by voting groups is
required, the information required by paragraph (c) of this subsection
separately provided for each voting group entitled to vote separately on the
plan to dissolve.
(2) A corporation is dissolved upon the
effective date of its articles of dissolution. [1987 c.52 §141]
60.634
Revocation of dissolution.
(1) A corporation may revoke its dissolution within 120 days of its effective date.
(2) Revocation of dissolution must be
authorized in the same manner as the dissolution was authorized unless that
authorization of dissolution permits revocation by action by the board of
directors alone. If the authorization of dissolution permits revocation by
action of the board of directors alone, the board of directors may revoke the
dissolution without shareholder action.
(3) After the revocation of dissolution is
authorized, the corporation may revoke the dissolution by delivering to the
office for filing, articles of revocation of dissolution that set forth:
(a) The name of the corporation;
(b) The effective date of the dissolution
that was revoked;
(c) The date that the revocation of
dissolution was authorized;
(d) If the corporations board of
directors, or incorporators, revoked the dissolution, a statement to that
effect;
(e) If the corporations board of
directors revoked a dissolution authorized by the shareholders, a statement
that revocation was permitted by action by the board of directors alone
pursuant to that authorization; and
(f) If shareholder action was required to
revoke the dissolution, the information required by ORS 60.631 (1)(c) and (d).
(4) Unless a delayed effective date is
specified, revocation of dissolution is effective when articles of revocation
of dissolution are filed.
(5) When the revocation of dissolution is
effective, it relates back to and takes effect as of the effective date of the
dissolution and the corporation resumes carrying on its business as if dissolution
had never occurred. [1987 c.52 §142]
60.637
Effect of dissolution. (1) A
dissolved corporation continues its corporate existence but may not carry on
any business except that appropriate to wind up and liquidate its business and
affairs, including:
(a) Collecting its assets;
(b) Disposing of its properties that will
not be distributed in kind to its shareholders;
(c) Discharging or making provision for
discharging its liabilities;
(d) Distributing its remaining property
among its shareholders according to their interests; and
(e) Doing every other act necessary to
wind up and liquidate its business and affairs.
(2) Dissolution of a corporation does not:
(a) Transfer title to the corporations
property;
(b) Prevent transfer of its shares or
securities, although the authorization to dissolve may provide for closing the
corporations share transfer records;
(c) Subject its directors or officers to
standards of conduct different from those prescribed in this chapter;
(d) Change quorum or voting requirements
for the board of directors or shareholders, change provisions for selection,
resignation, or removal of its directors or officers or both or change
provisions for amending its bylaws;
(e) Prevent commencement of a proceeding
by or against the corporation in its corporate name;
(f) Abate or suspend a proceeding pending
by or against the corporation on the effective date of dissolution; or
(g) Terminate the authority of the
registered agent of the corporation. [1987 c.52 §143]
60.641
Known claims against dissolved corporation. (1) A dissolved corporation may dispose of the known claims against it
by following the procedure described in this section.
(2) The dissolved corporation shall notify
its known claimants in writing of the dissolution at any time after its
effective date. The written notice must:
(a) Describe information that must be
included in a claim;
(b) Provide a mailing address where a
claim may be sent;
(c) State the deadline, which may not be
fewer than 120 days from the effective date of the written notice, by which the
dissolved corporation must receive the claim; and
(d) State that the claim will be barred if
not received by the deadline.
(3) A claim against the dissolved
corporation is barred:
(a) If a claimant who was given written
notice under subsection (2) of this section does not deliver the claim to the
dissolved corporation by the deadline; or
(b) If a claimant whose claim was rejected
by the dissolved corporation does not commence a proceeding to enforce the
claim within 90 days from the effective date of the rejection notice.
(4) For purposes of this section, claim
does not include a contingent liability or a claim based on an event occurring
after the effective date of dissolution. [1987 c.52 §144]
60.644
Unknown claims against dissolved corporation. (1) A dissolved corporation may also publish notice of its dissolution
and request that persons with claims against the corporation present them in
accordance with the notice.
(2) The notice must:
(a) Be published one time in a newspaper
of general circulation in the county where the dissolved corporations
principal office is located, or if the principal office is not in this state,
where its registered office is or was last located;
(b) Describe the information that must be
included in a claim and provide a mailing address where the claim may be sent;
and
(c) State that a claim against the
corporation will be barred unless a proceeding to enforce the claim is
commenced within five years after the publication of the notice.
(3) If the dissolved corporation publishes
a newspaper notice in accordance with subsection (2) of this section, the claim
of each of the following claimants is barred unless the claimant commences a
proceeding to enforce the claim against the dissolved corporation within five
years after the publication date of the newspaper notice:
(a) A claimant who did not receive written
notice under ORS 60.641;
(b) A claimant whose claim was sent in a
timely manner to the dissolved corporation but not acted on; or
(c) A claimant whose claim is contingent
or based on an event occurring after the effective date of dissolution. [1987
c.52 §145; 1991 c.883 §11]
60.645
Enforcement of claims against dissolved corporation. A claim against a dissolved corporation that
is not barred under ORS 60.641 or 60.644 may be enforced:
(1) Against the dissolved corporation to
the extent of its undistributed assets; or
(2) If the assets have been distributed in
liquidation, against the shareholder of the dissolved corporation to the extent
of the shareholders pro rata share of the claim or the corporate assets
distributed to the shareholder in liquidation, whichever is less. A shareholders
total liability for all claims under this section may not exceed the total
value of assets distributed to the shareholder, as of the date or dates of
distribution, less any liability of the corporation paid on behalf of the
corporation by that shareholder after the date of the distribution. [1991 c.883
§16]
(Administrative
Dissolution)
60.647
Grounds for administrative dissolution. The Secretary of State may commence a proceeding under ORS 60.651 to
administratively dissolve a corporation if:
(1) The corporation does not pay when due
any fees imposed by this chapter;
(2) The corporation does not deliver its
annual report to the Secretary of State when due;
(3) The corporation is without a
registered agent or registered office in this state;
(4) The corporation does not notify the
Secretary of State that its registered agent or registered office has been
changed, that its registered agent has resigned or that its registered office
has been discontinued; or
(5) The corporations period of duration
stated in its articles of incorporation expires. [1987 c.52 §146]
60.651
Procedure; effect of administrative dissolution. (1) If the Secretary of State determines
that one or more grounds exist under ORS 60.647, for dissolving a corporation,
the Secretary of State shall give the corporation written notice of the
determination.
(2) If the corporation does not correct
each ground for dissolution or demonstrate to the reasonable satisfaction of
the Secretary of State, within 45 days after notice is given, that each ground
determined by the Secretary of State does not exist, the Secretary of State
shall dissolve the corporation.
(3) A corporation administratively
dissolved continues its corporate existence but may not carry on any business
except that necessary to wind up and liquidate its business and affairs under
ORS 60.637, and notify claimants under ORS 60.641 and 60.644.
(4) The administrative dissolution of a
corporation does not terminate the authority of its registered agent. [1987
c.52 §147; 1987 c.579 §6; 1993 c.190 §2]
60.654
Reinstatement following administrative dissolution. (1) A corporation administratively dissolved
under ORS 60.651 may apply to the Secretary of State for reinstatement within
five years from the date of dissolution. The application shall:
(a) State the name of the corporation and
the effective date of its administrative dissolution; and
(b) State that the ground or grounds for
dissolution either did not exist or have been eliminated.
(2) If the Secretary of State determines
that the application contains the information required by subsection (1) of
this section, that the information is correct and that the corporations name
satisfies the requirements of ORS 60.094, the Secretary of State shall
reinstate the corporation.
(3) When the reinstatement is effective,
it relates back to and takes effect as of the effective date of the
administrative dissolution and the corporation resumes carrying on its business
as if the administrative dissolution had never occurred. [1987 c.52 §148; 1995
c.215 §7]
60.657
Appeal from denial of reinstatement. (1) If the Secretary of State denies a corporations application for
reinstatement following administrative dissolution, the Secretary of State
shall give written notice to the corporation that explains the reason or
reasons for denial.
(2) The corporation may appeal the denial
of reinstatement pursuant to the provisions of ORS chapter 183. [1987 c.52 §149]
(Judicial
Dissolution)
60.661
Grounds for judicial dissolution. The circuit courts may dissolve a corporation:
(1) In a proceeding by the Attorney General
if it is established that:
(a) The corporation obtained its articles
of incorporation through fraud; or
(b) The corporation has continued to
exceed or abuse the authority conferred upon it by law.
(2) In a proceeding by a shareholder in a
corporation that has shares that are listed on a national securities exchange
or that are regularly traded in a market maintained by one or more members of a
national or affiliated securities association, if it is established that:
(a) The directors are deadlocked in the
management of the corporate affairs, the shareholders are unable to break the
deadlock and irreparable injury to the corporation is threatened or being
suffered, or the business and affairs of the corporation can no longer be
conducted to the advantage of the shareholders generally, because of the
deadlock;
(b) The directors or those in control of
the corporation have acted, are acting or will act in a manner that is illegal,
oppressive or fraudulent;
(c) The shareholders are deadlocked in
voting power and have failed, for a period that includes at least two
consecutive annual meeting dates, to elect successors to directors whose terms
have expired; or
(d) The corporate assets are being
misapplied or wasted.
(3) In a proceeding by a creditor if it is
established that:
(a) The creditors claim has been reduced
to judgment, the execution on the judgment returned unsatisfied and the
corporation is insolvent; or
(b) The corporation has admitted in
writing that the creditors claim is due and owing and the corporation is
insolvent.
(4) In a proceeding by the corporation to
have its voluntary dissolution continued under court supervision. [1987 c.52 §150;
2001 c.315 §58]
60.664
Procedure for judicial dissolution. (1) Venue for a proceeding by the Attorney General to dissolve a
corporation lies in
(2) It is not necessary to make
shareholders parties to a proceeding to dissolve a corporation unless relief is
sought against them individually.
(3) A court in a proceeding brought to
dissolve a corporation may issue injunctions, appoint a receiver or custodian
pendente lite with all powers and duties the court directs, take other action
required to preserve the corporate assets wherever located and carry on the
business of the corporation until a full hearing can be held. [1987 c.52 §151;
2001 c.315 §61]
60.667
Receivership or custodianship.
(1) A court in a judicial proceeding brought to dissolve a corporation, or in a
judicial proceeding for shareholder remedies described in ORS 60.952, may appoint
one or more receivers to wind up and liquidate the business and affairs of the
corporation or one or more custodians to manage the business and affairs of the
corporation. The court shall hold a hearing, after notifying all parties to the
proceeding and any interested persons designated by the court, before
appointing a receiver or custodian. The court appointing a receiver or
custodian has exclusive jurisdiction over the corporation and all its property
wherever located.
(2) The court may appoint an individual or
a domestic or foreign corporation, authorized to transact business in this
state, as a receiver or custodian. The court may require the receiver or
custodian to post bond, with or without sureties, in an amount the court
directs.
(3) The court shall describe the powers
and duties of the receiver or custodian in its appointing order, which may be
amended periodically. Among other powers:
(a) The receiver may dispose of all or any
part of the assets of the corporation wherever located, at a public or private
sale, if authorized by the court and may sue and defend in the receivers own
name as receiver of the corporation in all courts of this state.
(b) The custodian may exercise all of the
powers of the corporation, through or in place of its board of directors or
officers, to the extent necessary to manage the affairs of the corporation in
the best interests of its shareholders and creditors.
(4) The court during a receivership may
redesignate the receiver a custodian, and during a custodianship may
redesignate the custodian a receiver, if doing so is in the best interests of
the corporation, its shareholders and creditors.
(5) The court periodically during the
receivership or custodianship may order compensation paid and expense
disbursements or reimbursements made to the receiver or custodian and the
receivers or custodians counsel from the assets of the corporation or
proceeds from the sale of the assets. [1987 c.52 §152; 2001 c.315 §62]
60.671
Judgment of dissolution. (1)
If after a hearing the court determines that one or more grounds for judicial
dissolution described in ORS 60.661 or 60.952 (2)(m) exist, it may enter a
judgment dissolving the corporation and specifying the effective date of the
dissolution. The clerk of the court shall deliver a certified copy of the
judgment to the office for filing. The Secretary of State shall file the
certified copy of the judgment.
(2) After entering the judgment of
dissolution, the court shall direct the winding up and liquidation of the
corporations business and affairs in accordance with ORS 60.637 and the
notification of claimants in accordance with ORS 60.641 and 60.644. [1987 c.52 §153;
2001 c.315 §63; 2003 c.576 §323]
(Disposition
of Assets)
60.674
Asset distribution; deposit with Department of State Lands; claims. Assets of a dissolved corporation that
should be distributed to a creditor, claimant or shareholder of the corporation
who cannot be found shall be reduced to cash and, within one year after the
final distribution in such liquidation or winding up is payable, deposited with
the Department of State Lands. The receiver or other liquidating agent shall
prepare in duplicate and under oath a statement containing the names and
last-known addresses of the persons entitled to such funds. One of the
statements shall be filed with the Department of State Lands with the cash and
another shall be delivered to the office for filing. The owner, heirs or
personal representatives of the owner, may file a claim with the Department of
State Lands in the manner provided by ORS 98.392 and 98.396. [1987 c.52 §154;
1993 c.694 §34]
FOREIGN
CORPORATIONS
(Authority to
Transact Business)
60.701
Authority to transact business required. (1) A foreign corporation may not transact business in this state until
it has been authorized to do so by the Secretary of State.
(2) The following activities among others,
do not constitute transacting business within the meaning of subsection (1) of
this section:
(a) Maintaining, defending or settling any
proceeding.
(b) Holding meetings of the board of
directors or shareholders or carrying on other activities concerning internal
corporate affairs.
(c) Maintaining bank accounts.
(d) Maintaining offices or agencies for
the transfer, exchange and registration of the corporations own securities or
maintaining trustees or depositaries with respect to those securities.
(e) Selling through independent
contractors.
(f) Soliciting or obtaining orders,
whether by mail or through employees or agents or otherwise, if the orders
require acceptance outside this state before they become contracts.
(g) Creating or acquiring indebtedness,
mortgages and security interests in real or personal property.
(h) Securing or collecting debts or
enforcing mortgages and security interests in property securing the debts.
(i) Owning without more real or personal
property.
(j) Conducting an isolated transaction
that is completed within 30 days and is not one in the course of repeated
transactions of a like nature.
(k) Transacting business in interstate
commerce.
(3) The list of activities in subsection
(2) of this section is not exhaustive. [1987 c.52 §155]
60.704
Consequences of transacting business without authority. (1) A foreign corporation transacting
business in this state without authorization from the Secretary of State may
not maintain a proceeding in any court in this state until it obtains
authorization from the Secretary of State to transact business in this state.
(2) The successor to a foreign corporation
that transacted business in this state without authority to transact business
in this state and the assignee of a cause of action arising out of that
business may not maintain a proceeding based on that cause of action in any
court in this state until the foreign corporation or its successor obtains
authorization from the Secretary of State to transact business in this state.
(3) A court may stay a proceeding
commenced by a foreign corporation, its successor or assignee until it
determines whether the foreign corporation or its successor requires
authorization from the Secretary of State to transact business in this state.
If it so determines, the court may further stay the proceeding until the
foreign corporation or its successor obtains the authorization.
(4) A foreign corporation that transacts
business in this state without authority shall be liable to this state for the
years or parts thereof during which it transacted business in this state
without authority in an amount equal to all fees that would have been imposed by
this chapter upon such corporation had it duly applied for and received
authority to transact business in this state as required by this chapter and
thereafter filed all reports required by this chapter.
(5) Notwithstanding subsections (1) and
(2) of this section, the failure of a foreign corporation to obtain authority
to transact business in this state does not impair the validity of its
corporate acts or prevent it from defending any proceeding in this state. [1987
c.52 §156]
60.707
Application for authority to transact business. (1) A foreign corporation may apply for
authority to transact business in this state by delivering an application to
the office for filing. The application shall set forth:
(a) The name of the foreign corporation
or, if its name is unavailable for filing in this state, another corporate name
that satisfies the requirements of ORS 60.717;
(b) The name of the state or country under
whose law it is incorporated;
(c) Its date of incorporation and period
of duration if not perpetual;
(d) The address, including street and
number and mailing address, if different, of its principal office;
(e) The address, including street and
number, of its registered office in this state and the name of its registered
agent at that office; and
(f) The names and respective addresses of
the president and secretary of the foreign corporation.
(2) The foreign corporation shall deliver
with the completed application a certificate of existence, or a document of
similar import, current within 60 days of delivery and authenticated by the
official having custody of corporate records in the state or country under
whose law it is incorporated. [1987 c.52 §157]
60.711
Amendment to application for authority. (1) A foreign corporation authorized to transact business in this
state shall deliver an amendment to the application for authority to transact
business in this state to the office for filing if it changes:
(a) Its corporate name as shown on the
records of the office; or
(b) The period of its duration.
(2) The amendment to the application for
authority to transact business in this state shall set forth its corporate name
shown on the records of the office and the new corporate name or the new period
of duration. The corporate name as changed must satisfy the requirements of ORS
60.717. [1987 c.52 §158]
60.714
Effect of authority. (1) A
foreign corporation authorized to transact business in this state has the same
but no greater rights and has the same but no greater privileges as, and except
as otherwise provided by this chapter is subject to the same duties,
restrictions, penalties and liabilities now or later imposed on, a domestic
corporation of like character.
(2) The filing by the Secretary of State
of an application or amendment to the application for authority to transact
business shall constitute authorization to transact business in this state,
subject to the right of the Secretary of State to revoke the authorization.
(3) This chapter does not authorize this
state to regulate the organization or internal affairs of a foreign corporation
authorized to transact business in this state. [1987 c.52 §159]
60.717
Corporate name of foreign corporation. (1) Except as provided in subsections (2) and (3) of this section, the
Secretary of State shall not authorize a foreign corporation to transact
business in this state if the corporate name of the corporation does not
conform to ORS 60.094.
(2) The name of the corporation must
contain a word or abbreviation required by ORS 60.094 (1) unless the corporate
name contains some other word, phrase or abbreviation that the laws of the
place of incorporation require to denote a person of limited liability.
(3) If a corporate name, professional
corporate name, nonprofit corporate name, cooperative name, limited partnership
name, business trust name, reserved name, registered corporate name or assumed
business name of active record with the office is not distinguishable on the
records of the office from the corporate name of the applicant foreign
corporation, the Secretary of State shall not authorize the applicant to
transact business in this state unless the foreign corporation states the
corporate name on the application for authority to transact business in this
state under ORS 60.707 as (name under which incorporated), a corporation of
(place of incorporation), the entirety of which shall be the real and true name
of the corporation under ORS chapter 648.
(4) If a foreign corporation authorized to
transact business in this state changes its corporate name to one that does not
satisfy the requirements of this section, it may not transact business in this
state under the changed name until it adopts a name satisfying the requirements
of this section and ORS 60.711. [1987 c.52 §160]
60.721
Registered office and registered agent of foreign corporation. Each foreign corporation authorized to
transact business in this state must continuously maintain in this state:
(1) A registered office that may be, but
need not be, the same as any of its places of business; and
(2) A registered agent who may be:
(a) An individual who resides in this
state and whose business office is identical to the registered office;
(b) A domestic corporation, domestic
limited liability company, domestic professional corporation or domestic
nonprofit corporation whose business office is identical to the registered
office; or
(c) A foreign corporation, foreign limited
liability company, foreign professional corporation or foreign nonprofit
corporation authorized to transact business in this state whose business office
is identical to the registered office. [1987 c.52 §161; 2001 c.315 §25]
60.724
Change of registered office or registered agent of foreign corporation. (1) A foreign corporation authorized to
transact business in this state may change its registered office or registered
agent by delivering to the office of the Secretary of State for filing a
statement of change that sets forth:
(a) The name of the foreign corporation;
(b) If the registered office is to be
changed, the street address, including street and number, of the new registered
office;
(c) If the registered agent is to be
changed, the name of the new registered agent and a statement that the new
agent has consented to the appointment; and
(d) That after the change or changes are
made, the street addresses of the registered office and the business office of
its registered agent will be identical.
(2) If a registered agent changes the
street address of the agents business office, the registered agent shall
change the street address of the registered office of the foreign corporation
for which the agent is the registered agent by notifying the corporation in
writing of the change and signing, either manually or in facsimile, and
delivering to the office of the Secretary of State a statement of change that
complies with the requirements of subsection (1) of this section and states
that the corporation has been notified of the change.
(3) The filing of the statement by the
Secretary of State shall terminate the existing registered office or agent or
both, on the effective date of the filing and establish the newly appointed
registered office or agent, or both, as that of the foreign corporation. [1987
c.52 §162]
60.727
Resignation of registered agent of foreign corporation. (1) The registered agent of a foreign
corporation may resign as agent upon delivering a signed statement to the
office and giving notice in the form of a copy of the statement to the foreign
corporation. The statement of resignation may include a statement that the
registered office is also discontinued.
(2) Upon the delivery of the signed
statement, the Secretary of State shall file the resignation statement. The
copy of the statement given to the foreign corporation under subsection (1) of
this section shall be addressed to the foreign corporation at the foreign
corporations mailing address or the foreign corporations principal office as
shown on the records of the office of the Secretary of State.
(3) The agency appointment is terminated
and the registered office discontinued if so provided in the signed statement
under subsection (1) of this section on the 31st day after the date on which
the statement was filed by the Secretary of State unless the foreign
corporation has previously appointed a successor registered agent, as provided
in ORS 60.724 thereby terminating the capacity of such agent. [1987 c.52 §163;
1993 c.190 §3]
60.731
Service on foreign corporation.
(1) The registered agent appointed by a foreign corporation authorized to
transact business in this state shall be an agent of such corporation upon whom
any process, notice or demand required or permitted by law to be served upon
the corporation may be served.
(2) The Secretary of State shall be an
agent of a foreign corporation upon whom any process, notice or demand may be
served, if:
(a) The corporation is authorized to
transact business in this state, and it fails to appoint or maintain a
registered agent in this state, or its registered agent cannot with reasonable
diligence be found at the registered office;
(b) The corporations authority to
transact business in this state has been revoked;
(c) The corporation is transacting
business in this state without being authorized as provided in this chapter;
(d) The corporation has been authorized to
transact business in this state and has withdrawn; or
(e) The corporation has transacted
business in this state without being authorized to do so, has ceased to
transact business and has become subject to service on the Secretary of State
as prescribed in this chapter.
(3) Service on the Secretary of State of
any such process, notice or demand shall be made in the same manner as provided
in ORS 60.121 (3), except that when the corporation served is not authorized to
transact business in this state and was not authorized to transact business in
this state at the time the transaction, event or occurrence upon which the
proceeding is based occurred, the copy of the process, notice or demand shall
be sent immediately by registered or certified mail by the plaintiff or the
attorney of the plaintiff to the principal office or place of business of the
corporation, instead of the last registered office of the corporation.
(4) The Secretary of State shall keep a
record of all processes, notices and demands served upon the Secretary of State
under this section.
(5) After completion of initial service
upon the Secretary of State, no additional documents need to be served upon the
Secretary of State to maintain jurisdiction in the same proceeding or to give
notice of any motion or provisional process.
(6) Nothing contained in this section
shall limit or affect the right to serve any process, notice or demand required
or permitted by law to be served upon a corporation in any other manner
permitted by law, or enlarge the purposes for which service on the Secretary of
State is permitted where such purposes are limited by other provisions of law. [1987
c.52 §164]
(Withdrawal)
60.734
Withdrawal of foreign corporation. (1) A foreign corporation authorized to transact business in this
state may withdraw from transacting business in this state by applying to the
office for withdrawal. The application shall set forth:
(a) The name of the foreign corporation
and the name of the state or country under whose law it is incorporated;
(b) That it is not transacting business in
this state and that it surrenders its authority to transact business in this
state;
(c) That it revokes the authority of its
registered agent to accept service on its behalf and appoints the Secretary of
State as its agent for service of process in any proceeding based on a cause of
action arising during the time it was authorized to transact business in this
state;
(d) A mailing address to which the person
initiating any proceedings may mail to the foreign corporation a copy of any
process served on the Secretary of State under paragraph (c) of this
subsection; and
(e) A commitment to notify the Secretary
of State for a period of five years from the date of withdrawal of any change
in its mailing address.
(2) Upon filing by the Secretary of State
of the application to withdraw, the authority of the foreign corporation to
transact business in this state shall cease. [1987 c.52 §165]
(Revocation
of Authority)
60.737
Grounds for revocation. The
Secretary of State may commence a proceeding under ORS 60.741 to revoke the
authority of a foreign corporation to transact business in this state if:
(1) The foreign corporation does not
deliver its annual report to the Secretary of State within the time prescribed
by this chapter;
(2) The foreign corporation does not pay
within the time prescribed by this chapter any fees imposed by this chapter;
(3) The foreign corporation has failed to
appoint or maintain a registered agent or registered office in this state as
prescribed by this chapter;
(4) The foreign corporation does not
inform the Secretary of State under ORS 60.724 or 60.727 that its registered
agent or registered office has changed, that its registered agent has resigned
or that its registered office has been discontinued;
(5) An incorporator, director, officer or
agent of the foreign corporation signed a document knowing it was false in any
material respect with intent that the document be delivered to the office for
filing; or
(6) The Secretary of State receives a duly
authenticated certificate from the official having custody of corporate records
in the state or country under whose law the foreign corporation is incorporated
stating that it has been dissolved or disappeared as the result of a merger. [1987
c.52 §166]
60.741
Procedure for and effect of revocation. (1) If the Secretary of State determines that one or more grounds
exist under ORS 60.737 for revocation of authority of a foreign corporation to
transact business in this state, the Secretary of State shall give the foreign
corporation written notice of the determination.
(2) If the foreign corporation does not
correct each ground for revocation or demonstrate to the reasonable
satisfaction of the Secretary of State that each ground determined by the
Secretary of State does not exist within 45 days after notice is given, the
Secretary of State shall revoke the foreign corporations authority.
(3) The authority of a foreign corporation
to transact business in this state ceases as of the date of revocation of its
authority to transact business in this state.
(4) The Secretary of States revocation of
a foreign corporations authority to transact business in this state appoints
the Secretary of State the foreign corporations agent for service of process
in any proceeding based on a cause of action which arose during the time the
foreign corporation was authorized to transact business in this state.
(5) Revocation of a foreign corporations
authority to transact business in this state terminates the authority of the
registered agent of the corporation. [1987 c.52 §167; 1993 c.190 §4]
60.744
Appeal from revocation. In
addition to any other legal remedy which may be available, a foreign
corporation shall have the right to appeal the Secretary of States revocation
of its authority to transact business in this state pursuant to the provisions
of ORS chapter 183. [1987 c.52 §168]
60.747
Reinstatement of authority.
(1) A foreign corporation which has had its authority revoked under ORS 60.737
may apply to the Secretary of State for reinstatement within five years from
the date of revocation. The application shall:
(a) State the name of the corporation and
the effective date its authority was revoked; and
(b) State that the ground or grounds for
revocation of authority either did not exist or have been eliminated.
(2) If the Secretary of State determines
that the application contains the information required by subsection (1) of
this section, that the information is correct and that the corporations name
satisfies the requirements of ORS 60.717, the Secretary of State shall
reinstate the authority.
(3) When the reinstatement is effective,
it relates back to and takes effect as of the effective date of the
administrative revocation of authority and the corporation resumes carrying on
its business as if the administrative revocation of authority had never
occurred. [1989 c.1040 §33; 1995 c.215 §8]
RECORDS AND
REPORTS
(Records)
60.771
Corporate records. (1) A
corporation shall keep as permanent records minutes of all meetings of its
shareholders and board of directors, a record of all actions taken by the
shareholders or board of directors without a meeting and a record of all
actions taken by a committee of the board of directors in place of the board of
directors on behalf of the corporation.
(2) A corporation shall maintain
appropriate accounting records.
(3) A corporation or its agent shall
maintain a record of its shareholders, in a form that permits preparation of a
list of the names and addresses of all shareholders in alphabetical order by
class of shares showing the number and class of shares held by each.
(4) A corporation shall maintain its
records in written form or in another form capable of conversion into written form
within a reasonable time.
(5) A corporation shall keep a copy of the
following records at its principal office or registered office:
(a) Its articles or restated articles of
incorporation and all amendments to them currently in effect;
(b) Its bylaws or restated bylaws and all
amendments to them currently in effect;
(c) Resolutions adopted by its board of
directors creating one or more classes or series of shares and fixing their
relative rights, preferences and limitations, if shares issued pursuant to
those resolutions are outstanding;
(d) The minutes of all shareholders
meetings and records of all action taken by shareholders without a meeting, for
the past three years;
(e) All written communications to
shareholders generally within the past three years;
(f) A list of the names and business
addresses of its current directors and officers; and
(g) Its most recent annual report
delivered to the Secretary of State under ORS 60.787. [1987 c.52 §169]
60.774
Inspection of records by shareholders. (1) Subject to ORS 60.777 (3), a shareholder of a corporation is
entitled to inspect and copy, during regular business hours at the corporations
principal office, any of the records of the corporation described in ORS 60.771
(5) if the shareholder gives the corporation written notice of the shareholders
demand at least five business days before the date on which the shareholder
wishes to inspect and copy.
(2) A shareholder of a corporation is
entitled to inspect and copy, during regular business hours at a reasonable
location specified by the corporation, any of the following records of the
corporation if the shareholder meets the requirements of subsection (3) of this
section and gives the corporation written notice of the shareholders demand at
least five business days before the date on which the shareholder wishes to
inspect and copy:
(a) Excerpts from minutes of any meeting
of the board of directors, records of any action of a committee of the board of
directors while acting in place of the board of directors on behalf of the
corporation, minutes of any meeting of the shareholders and records of action
taken by the shareholders or board of directors without a meeting, to the
extent not subject to inspection under subsection (1) of this section;
(b) Accounting records of the corporation,
including tax returns; and
(c) The record of shareholders.
(3) A shareholder may inspect and copy the
records identified in subsection (2) of this section only if:
(a) The shareholders demand is made in
good faith and for a proper purpose;
(b) The shareholder described with
reasonable particularity the shareholders purpose and the records the
shareholder desires to inspect; and
(c) The records are directly connected
with the shareholders purpose.
(4) The right of inspection granted by
this section may not be abolished or limited by a corporations articles of
incorporation or bylaws.
(5) This section does not affect:
(a) The right of a shareholder to inspect
records under ORS 60.224 or, if the shareholder is in litigation with the
corporation, to the same extent as any other litigant; or
(b) The power of a court, independent of
this chapter, to compel the production of corporate records for examination.
(6) For purposes of this section, shareholder
includes a beneficial owner whose shares are held in a voting trust or by a
nominee on behalf of the beneficial owner. [1987 c.52 §170; 1989 c.1040 §34;
1993 c.403 §10]
60.777
Scope of inspection right.
(1) A shareholders agent or attorney has the same inspection and copying
rights as the shareholder.
(2) The right to copy records under ORS
60.774 includes, if reasonable, the right to receive copies made by
photographic, xerographic or other means.
(3) The corporation may impose a
reasonable charge, covering the costs of labor and material, for copies of any
documents provided to the shareholder. The charge may not exceed the estimated
cost of production or reproduction of the records.
(4) The corporation may comply with a
shareholders demand to inspect the record of shareholders under ORS 60.774
(2)(c) by providing the shareholder with a list of its shareholders that was
compiled no earlier than the date of the shareholders demand. [1987 c.52 §171]
60.781
Court-ordered inspection.
(1) If a corporation does not allow a shareholder who complies with ORS 60.774
(1) to inspect and copy any records required by that subsection to be available
for inspection, the circuit court of the county where the corporations
principal office is located, or, if the principal office is not in this state,
where its registered office is or was last located, may summarily order
inspection and copying of the records demanded at the corporations expense
upon application of the shareholder.
(2) If a corporation does not within a reasonable
time allow a shareholder to inspect and copy any other record, the shareholder
who complies with ORS 60.774 (2) and (3) may apply to the circuit court in the
county where the corporations principal office is located, or, if the
principal office is not in this state, where its registered office is or was
last located, for an order to permit inspection and copying of the records
demanded.
(3) If the court orders inspection and
copying of the records demanded, it shall also order the corporation to pay the
shareholders costs, including reasonable counsel fees, incurred to obtain the
order unless the corporation proves that it refused inspection in good faith
because it had a reasonable basis for doubt about the right of the shareholder
to inspect the records demanded.
(4) If the court orders inspection and
copying of the records demanded, it may impose reasonable restrictions on the
use or distribution of the records by the demanding shareholder.
(5) No order shall be issued under this
section without notice to the corporation at least five days in advance of the
time specified for the hearing unless a different period is fixed by the court.
The shareholders request shall be set for hearing at the earliest possible
time and shall take precedence over all matters, except matters of the same
character and hearing on preliminary injunctions under ORCP 79 B(3). [1987 c.52
§172]
(Reports)
60.784
Reports to shareholders of indemnification. If a corporation indemnifies or advances expenses to a director under
ORS 60.391, 60.394, 60.397 or 60.401 in connection with a proceeding by or in
the right of the corporation, the corporation shall report the indemnification
or advance in writing to the shareholders with or before the notice of the next
shareholders meeting. [1987 c.52 §173]
60.787
Annual report. (1) Each
domestic corporation, and each foreign corporation authorized to transact
business in this state, shall by its anniversary deliver to the office for
filing an annual report that sets forth:
(a) The name of the corporation and the
state or country under whose law it is incorporated;
(b) The street address of its registered
office and the name of its registered agent at that office in this state;
(c) The address, including street and
number and mailing address, if different, of its principal office;
(d) The names and addresses of the
president and secretary of the corporation;
(e) The category of the classification
code established by rule of the Secretary of State most closely designating the
primary business activity of the corporation; and
(f) Additional identifying information
that the Secretary of State may require by rule.
(2) The information contained on the
annual report shall be current as of 30 days before the anniversary of the corporation.
(3) The Secretary of State shall mail the
annual report form to any address shown for the corporation in the current
records of the office. The failure of the corporation to receive the annual
report form from the Secretary of State shall not relieve the corporation of
its duty to deliver an annual report to the office as required by this section.
(4) If an annual report does not contain
the information required by this section, the Secretary of State shall notify
the reporting domestic or foreign corporation in writing and return the report
to it for correction. The domestic or foreign corporation must correct the
error within 45 days after the Secretary of State gives such notice.
(5) A domestic or foreign corporation may
deliver to the office for filing an amendment to the annual report if a change
in the information set forth in the annual report occurs after the report is
delivered to the office for filing and before the next anniversary. This
subsection applies only to a change that is not required to be made by an
amendment to the articles of incorporation. The amendment to the annual report
must set forth:
(a) The name of the corporation as shown
on the records of the office; and
(b) The information as changed. [1987 c.52
§174; 1987 c.843 §14; 2007 c.186 §3]
REGULATION OF
CORPORATE ACQUISITIONS
60.801
Definitions for ORS 60.801 to 60.816. As used in ORS 60.801 to 60.816:
(1) Acquiring group means two or more
persons who agree to act together or enter into any arrangement or understanding
for the purpose of voting or acquiring voting shares of an issuing public
corporation, but does not include two or more persons whose sole agreement
relates to the granting of an immediately revocable proxy.
(2) Acquiring person means a person who
acquires or proposes to acquire ownership of, or the power to direct the voting
of, voting shares of an issuing public corporation and includes all affiliates
of such person.
(3)(a) Affiliate means a person who
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, another person. As used in this
subsection, control, including the terms controlled by and under common
control with, means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a person,
whether through the ownership of voting shares, by contract or otherwise. A
person who is the owner of 10 percent or more of a corporations outstanding
voting shares shall be presumed to have control of the corporation in the
absence of proof by a preponderance of the evidence to the contrary.
(b) Notwithstanding paragraph (a) of this
subsection, a presumption of control shall not apply where a person holds
voting shares in good faith and not for the purpose of circumventing ORS 60.801
to 60.816 as an agent, bank, broker, nominee, custodian or trustee for one or
more owners who do not individually or as a group have control of the
corporation.
(4)(a) Control share acquisition means
the acquisition, directly or indirectly, by any acquiring person, including a
member of an acquiring group, of ownership of, or the power to direct the
voting of, voting shares of an issuing public corporation in a transaction that
causes the total voting power of the acquiring person or any acquiring group of
which the acquiring person is a member in the election of directors of the
issuing public corporation to exceed one-fifth, one-third or one-half of the
total voting power of all the voting shares.
(b) For purposes of this subsection,
voting shares of an issuing public corporation acquired within 90 days of a
control share acquisition by the acquiring person or members of the acquiring
group making the control share acquisition shall be considered to have been
acquired in the same control share acquisition.
(c) For purposes of this subsection, a
person who acquires voting shares in the ordinary course of business for the
benefit of others in good faith and not for the purpose of circumventing ORS
60.801 to 60.816 has ownership and voting power only of voting shares in
respect of which that person would be able to exercise or direct the exercise
of votes without further instruction from others.
(d) For purposes of this subsection, if
two or more persons enter into a binding agreement that is not immediately
revocable with respect to the voting of their voting shares, in addition to
those persons thereby becoming an acquiring group:
(A) Any single person who thereby obtains
the right to determine how any other parties to the agreement must vote their
shares shall be deemed to have acquired the power to direct the voting of the
voting shares held by such other parties to the agreement; and
(B) Any group of persons who thereby
obtain the right to determine how any parties to the agreement must vote their
shares shall collectively be deemed to be a separate acquiring person who has
acquired the power to direct the voting of all voting shares held by such
parties to the agreement. The group of persons shall include all parties to the
agreement if all parties share in the decision or if the agreement specifies
how the shares must be voted.
(e) The acquisition of any voting shares
of an issuing public corporation does not constitute a control share
acquisition if the acquisition is consummated in any of the following
circumstances:
(A) At a time when the corporation was not
subject to ORS 60.801 to 60.816.
(B) Pursuant to a contract entered into at
a time when the corporation was not subject to ORS 60.801 to 60.816.
(C) Pursuant to the laws of descent and
distribution.
(D) Pursuant to the satisfaction of a
pledge or other security interest created in good faith and not for the purpose
of circumventing ORS 60.801 to 60.816.
(E) In a transaction in which voting
shares are acquired from the issuing public corporation.
(F) Pursuant to a merger or plan of share
exchange effected in compliance with ORS 60.470 to 60.501, if the issuing
public corporation is a party to the agreement of merger or plan of share
exchange.
(G) Pursuant to a transfer of voting
shares between or among affiliates or immediate family members unless the
voting shares are control shares that have not had their voting rights restored
under ORS 60.807.
(H) In a transaction in which voting power
is acquired solely by receipt of an immediately revocable proxy or by any other
agreement or understanding that is not binding on the person transferring such
voting power.
(5)(a) Control shares means voting
shares of an issuing public corporation that are acquired in a control share
acquisition. Control shares does not include voting shares acquired in a
control share acquisition that are subsequently transferred, or whose voting
power is subsequently transferred, other than a transfer of voting power by
termination of a binding voting agreement, to a person that is not an affiliate
of the transferor or a member of an acquiring group of which the transferor is
a member in a transaction that is not a control share acquisition. Control shares
also does not include voting shares acquired in a control share acquisition
whose voting power is subsequently transferred pursuant to the termination of a
binding voting agreement if, assuming the parties to the agreement had never
entered into the agreement but had been members of an acquiring group during
the term of the agreement, the voting shares would not have been control
shares.
(b) If an acquiring person or any member
of an acquiring group transfers control shares in a transaction that causes the
control shares to cease to be control shares without reducing the total voting
power of the acquiring person or acquiring group to less than one-fifth of the
total voting power of all the voting shares, and within 90 days before or after
such transfer the transferor or any member of an acquiring group of which the
transferor is a member acquires ownership of, or the power to direct the voting
of, any voting shares, all such voting shares up to the number of voting shares
having total voting power equal to the total voting power of the control shares
transferred shall be considered control shares.
(6) Immediate family member means any
grandparent, parent, brother, sister, child, grandchild or spouse of a person,
or any other relative of the person or the persons spouse who has the same
home as the person.
(7)(a) Interested shares means voting
shares of an issuing public corporation that any of the following persons have
sole or shared power to vote, or direct the voting of, either directly or by
proxy or voting agreement, at a meeting at which the voting rights of control
shares are to be considered:
(A) The acquiring person or a member of
the acquiring group whose voting rights are under consideration.
(B) Any officer of the issuing public corporation.
(C) Any employee of the issuing public
corporation who is also a director of the corporation.
(b) For purposes of this subsection, a
person shall not be deemed to have the power to vote, or direct the voting of,
voting shares if the persons power with respect to the shares arises solely
from holding an immediately revocable proxy, unless the proxy is solicited in
connection with an offer to purchase or solicitation of offers to sell voting
shares which requires the granting of a proxy as a condition to the acceptance
of a tender of voting shares from any shareholder.
(8)(a) Issuing public corporation means
a corporation incorporated or existing pursuant to the provisions of this
chapter that has:
(A) One hundred or more record or
beneficial shareholders;
(B) Its principal place of business, its
principal office or assets with a fair market value of not less than $1 million
within this state; and
(C) Either:
(i) More than 10 percent of its record
shareholders resident in this state;
(ii) More than 10 percent of its shares
owned beneficially or of record by residents of this state; or
(iii) At least 10,000 of its record or
beneficial shareholders resident in this state.
(b) The residence of a shareholder is
presumed to be the address appearing in the records of the corporation.
(c) Shares held by banks, except as
trustee or guardian, brokers or nominees shall be disregarded for purposes of
calculating the percentages or numbers described in paragraph (a)(C) of this
subsection.
(9) Person means any individual,
corporation, partnership, unincorporated association or other entity.
(10) Total voting power of any person or
any shares means the voting power such person or shares would have except for
ORS 60.801 to 60.816.
(11) Voting shares means shares that
have, or would have except for this Act, voting power in any vote for the
election of directors and that belong to a class or series that, together with
all other classes or series that vote with such class or series as a group with
respect to the election of directors, elects at least a majority of the
directors. [1989 c.4 §1; 1989 c.1040 §37; 1991 c.7 §1; 2003 c.80 §17a]
Note: 60.801 to 60.816 were enacted into law by
the Legislative Assembly but were not added to or made a part of ORS chapter 60
or any series therein by legislative action. See Preface to Oregon Revised
Statutes for further explanation.
60.804
Applicability of ORS 60.801 to 60.816. (1) An issuing public corporation shall be subject to ORS 60.801 to
60.816 unless the corporations articles of incorporation or bylaws provide
that ORS 60.801 to 60.816 do not apply to acquisitions of its voting shares.
After a corporations articles of incorporation or bylaws are amended to
provide that ORS 60.801 to 60.816 do not apply to acquisitions of its voting
shares, any voting shares that were control shares prior to the amendment shall
cease to be considered control shares.
(2) An issuing public corporation whose
articles of incorporation or bylaws provide that it is not subject to ORS
60.801 to 60.816 may, at any time, amend its articles of incorporation or
bylaws in accordance with ORS 60.431 to 60.467 to remove the provision and
become subject to ORS 60.801 to 60.816.
(3) Any amendment to the articles of
incorporation or bylaws of an issuing public corporation relating to whether or
not the corporation is subject to ORS 60.801 to 60.816 that is adopted or
approved by the shareholders must be adopted or approved by holders of voting
shares with at least a majority of the votes entitled to be cast by holders of
voting shares in addition to any other vote that may be required by statute or
the articles of incorporation.
(4) Upon request by any person, a
corporation shall inform the person whether or not the corporations articles
of incorporation or bylaws provide that ORS 60.801 to 60.816 do not apply to
acquisitions of its voting shares. [1989 c.4 §2; 1991 c.7 §2]
Note: See note under 60.801.
60.807
Voting rights of control shares. (1) Control shares acquired in a control share acquisition have no
voting rights other than those provided for in subsection (2)(a) of this
section, unless the restoration of the voting rights associated with the shares
before the control share acquisition is approved by the shareholders of the issuing
public corporation.
(2) To be approved under this section, the
restoration of voting rights for control shares must be approved by:
(a) The holders of the voting shares,
including all interested shares, by a majority of all the votes entitled to be
cast by holders of voting shares; and
(b) The holders of the voting shares,
excluding all interested shares, by a majority of all the votes, other than
votes of interested shares, entitled to be cast by holders of voting shares. [1989
c.4 §3]
Note: See note under 60.801.
60.810
Acquiring person statement; shareholder meeting. (1) Any acquiring person who proposes to
make or has made a control share acquisition may at the persons election
deliver an acquiring person statement to the issuing public corporation at the
issuing public corporations principal office. The acquiring person statement
shall set forth all of the following:
(a) The identity of the acquiring person
and each other member of any acquiring group of which the person is a member.
(b) A statement that the acquiring person
statement is given pursuant to ORS 60.801 to 60.816.
(c) The number of voting shares of the
issuing public corporation owned, directly or indirectly, by the acquiring
person and each member of the acquiring group, and the acquisition dates and
acquisition prices of all such shares acquired in a control share acquisition
and within 90 days prior to the date of delivery of the acquiring person
statement.
(d) The number of additional voting shares
of which the acquiring person and each member of the acquiring group has the
power to direct the voting other than solely through the holding of an
immediately revocable proxy, the identities of the owners of the voting shares
and a description of the transaction or transactions in which the voting power
was acquired.
(e) If the control share acquisition has
not taken place, a description in reasonable detail of the terms of the
proposed control share acquisition, including the number of voting shares being
sought, the price or range of prices to be paid for the voting shares being
sought, the source of financing for the acquisition, whether or not the
acquisition will be made by means of a tender offer and, if so, whether the
tender offer will be for all outstanding voting shares.
(f) Any plans of the acquiring person for
a merger or other fundamental corporate change involving the issuing public
corporation.
(2) If the acquiring person requests at
the time of delivery of an acquiring person statement and gives an undertaking
to pay the corporations expenses of a special meeting, the directors of the
issuing public corporation shall, within 10 days after receipt by the
corporation of the acquiring person statement, call a special meeting of
shareholders of the issuing public corporation for the purpose of considering
the voting rights to be accorded the voting shares acquired or to be acquired
in the control share acquisition. Unless otherwise specified by the board of
directors, no other business shall be conducted at a special meeting of
shareholders called under this section.
(3) Unless the acquiring person agrees in
writing to another date, the special meeting of shareholders shall be held no
sooner than 30 days and no later than 50 days after receipt by the issuing
public corporation of the request.
(4) If no request is made, the voting
rights to be accorded the voting shares acquired in the control share
acquisition shall be presented to the next special or annual meeting of
shareholders that is held more than 60 days after the date of the control share
acquisition.
(5) If a special meeting is requested,
notice of the special meeting of shareholders shall be given as promptly as
reasonably practicable by the issuing public corporation to all shareholders of
record as of the record date set for the meeting, whether or not the
shareholders are entitled to vote at the meeting. The board of directors shall
fix the record date.
(6) Notice of the special or annual
shareholder meeting at which the voting rights are to be considered must
include or be accompanied by all of the following:
(a) A copy of the acquiring person
statement delivered to the issuing public corporation pursuant to ORS 60.801 to
60.816.
(b) A statement authorized by the board of
directors of the corporation of the position or recommendation of the board, or
that the board is taking no position or making no recommendation, with respect
to the proposed control share acquisition.
(c) A description of the dissenters
rights that may result from the vote of shareholders.
(7) To the extent the acquiring person
makes any representations in the acquiring person statement or any other
communication to the shareholders of the issuing public corporation relating to
transactions or other actions to be effected after the shareholder vote on
voting rights for control shares acquired by the acquiring person, any approval
of voting rights shall be conditioned upon the completion of those transactions
or actions as represented and shall be void if the transactions or actions are
not effected as represented.
(8) An acquiring person whose voting
rights for control shares are denied by the shareholders may request another
special meeting of shareholders in accordance with this section to consider
those voting rights no sooner than six months after the meeting at which voting
rights were denied. [1989 c.4 §4; 1991 c.7 §3]
Note: See note under 60.801.
60.813
Dissenters rights. Unless
otherwise provided in a corporations articles of incorporation or bylaws
before a control share acquisition has occurred, in the event control shares
acquired in a control share acquisition are accorded voting rights and the
acquiring person or acquiring group owns, or has the power to direct the voting
of, other than solely through the holding of immediately revocable proxies,
voting shares with a majority or more of the total voting power of all voting
shares, any holder of voting shares of the issuing public corporation who does
not vote in favor of the restoration of voting rights shall be entitled to
dissent from such restoration and obtain the fair value of the holders shares.
ORS 60.551 and 60.557 to 60.594 shall apply to dissenters rights created under
this section, except that for purposes of this section, fair value may not be a
value less than the highest price paid per share by the acquiring person or
acquiring group in the control share acquisition. ORS 60.554 shall not apply to
dissenters rights created under this section. [1989 c.4 §5]
Note: See note under 60.801.
60.816
Short title. ORS 60.801 to
60.813 shall be known and may be cited as the Oregon Control Share Act. [1989
c.4 §6]
Note: See note under 60.801.
BUSINESS
COMBINATIONS WITH INTERESTED SHAREHOLDERS
60.825
Definitions for ORS 60.825 to 60.845. As used in ORS 60.825 to 60.845:
(1) Affiliate means a person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, another person.
(2) Associate, when used to indicate a
relationship with any person, means:
(a) Any corporation or organization of
which the person is a director, officer or partner or is, directly or
indirectly, the owner of 20 percent or more of any class of voting stock;
(b) Any trust or other estate in which the
person has at least a 20 percent beneficial interest or as to which the person
serves as trustee or in a similar fiduciary capacity; and
(c) Any relative or spouse of the person,
or any relative of a spouse, who has the same residence as the person.
(3) Business combination, when used in
reference to any corporation and any interested shareholder of the corporation,
means:
(a) Any merger or plan of exchange of the
corporation or any direct or indirect majority-owned subsidiary of the
corporation with:
(A) The interested shareholder; or
(B) Any other corporation if the merger or
plan of exchange is caused by the interested shareholder and as a result of the
merger or plan of exchange, ORS 60.835 is not applicable to the surviving
corporation;
(b) Any sale, lease, exchange, mortgage,
pledge, transfer or other disposition, in one transaction or a series of
transactions, except proportionately as a shareholder of the corporation, to or
with the interested shareholder, whether as part of a dissolution or otherwise,
of assets of the corporation or of any direct or indirect majority-owned
subsidiary of the corporation where the assets have an aggregate market value
equal to 10 percent or more of either the aggregate market value of all the
assets of the corporation determined on a consolidated basis or the aggregate
market value of all the outstanding stock of the corporation;
(c) Any transaction which results in the
issuance or transfer by the corporation or by any direct or indirect
majority-owned subsidiary of the corporation of any shares of the corporation
or of any such subsidiary to the interested shareholder, except:
(A) Pursuant to the exercise, exchange or
conversion of securities exercisable for, exchangeable for or convertible into
shares of the corporation or any subsidiary where the securities were
outstanding prior to the time that the interested shareholder became an
interested shareholder or were distributed pro rata to all holders of a class
or series of shares of the corporation or any subsidiary subsequent to the time
the interested shareholder became an interested shareholder;
(B) Pursuant to a dividend or distribution
paid or made pro rata to all holders of a class or series of shares of the
corporation or any subsidiary subsequent to the time the interested shareholder
became an interested shareholder, provided that there is no increase in the
interested shareholders proportionate share of any class or series of shares
of the corporation or of the voting stock of the corporation; or
(C) Pursuant to an exchange offer by the
corporation to purchase shares made on the same terms to all holders of the
shares, provided that there is no increase in the interested shareholders
proportionate share of any class or series of shares of the corporation or of
the voting stock of the corporation;
(d) Any transaction involving the
corporation or any direct or indirect majority-owned subsidiary of the
corporation which has the effect, directly or indirectly, of increasing the
proportionate share of any class or series of shares, or securities convertible
into the shares of any class or series, of the corporation or of any such
subsidiary which is owned by the interested shareholder, except as a result of
immaterial changes due to fractional share adjustments or as a result of any
purchase or redemption of any shares not caused, directly or indirectly, by the
interested shareholder; or
(e) Any receipt by the interested
shareholder of the benefit, directly or indirectly, except proportionately as a
shareholder of such corporation, of any loans, advances, guarantees, pledges or
other financial benefits, other than those expressly permitted in paragraphs
(a) to (d) of this subsection, provided by or through the corporation or any
direct or indirect majority-owned subsidiary.
(4)(a) Control, including the terms controlling,
controlled by and under common control with, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a person, whether through the ownership of voting stock, by
contract or otherwise. A person who is the owner of 10 percent or more of a
corporations outstanding voting stock shall be presumed to have control of the
corporation, in the absence of proof by a preponderance of the evidence to the
contrary.
(b) Notwithstanding paragraph (a) of this
subsection, a presumption of control shall not apply when a person holds voting
stock, in good faith and not for the purpose of circumventing this section, as
an agent, bank, broker, nominee, custodian or trustee for one or more owners
who do not individually or as a group have control of the corporation.
(5)(a) Interested shareholder means:
(A) Any person, other than the corporation
and any direct or indirect majority-owned subsidiary of the corporation, that:
(i) Is the owner of shares representing 15
percent or more of the outstanding voting stock of the corporation; or
(ii) Is an affiliate or associate of the
corporation and was the owner of shares representing 15 percent or more of the
outstanding voting stock of the corporation at any time within the three-year
period immediately prior to the date on which it is sought to be determined
whether the person is an interested shareholder; and
(B) The affiliates and associates of a person
described in subparagraph (A) of this paragraph.
(b) Notwithstanding paragraph (a) of this
subsection, the term interested shareholder shall not include:
(A) Any person who:
(i) Owned shares in excess of the 15
percent limitation described in paragraph (a) of this subsection as of April 4,
1991, and who continued to own shares in excess of the 15 percent limitation or
would have but for action by the corporation;
(ii) Acquired shares in excess of the 15
percent limitation described in paragraph (a) of this subsection pursuant to a
tender offer commenced prior to April 4, 1991, and who continued to own shares
in excess of the 15 percent limitation or would have but for action by the
corporation;
(iii) Acquired shares in excess of the 15
percent limitation described in paragraph (a) of this subsection pursuant to an
exchange offer announced prior to April 4, 1991, and commenced within 90 days
after April 4, 1991, and who continued to own shares in excess of the 15
percent limitation or would have but for action by the corporation; or
(iv) Acquired shares in excess of the 15
percent limitation described in paragraph (a) of this subsection from a person
described in sub-subparagraphs (i) to (iii) of this subparagraph by gift,
inheritance or in a transaction in which no consideration was exchanged; or
(B) Any person whose ownership of shares
in excess of the 15 percent limitation described in paragraph (a) of this
subsection is the result of action taken solely by the corporation provided
that the person shall be an interested shareholder if the person later acquires
additional voting stock of the corporation, except as a result of further
corporate action not caused, directly or indirectly, by the person.
(c) For the purpose of determining whether
a person is an interested shareholder, the voting shares of the corporation
considered to be outstanding shall include shares considered to be owned by the
person through application of ORS 60.830 (1).
(6) Person means any individual,
corporation, partnership, unincorporated association or other entity.
(7) Voting stock means shares of any
class or series that, together with all other classes or series that vote with
the class or series as a group with respect to the election of directors,
elects at least a majority of the directors. [1991 c.40 §2]
60.830
Ownership of shares. (1) For
purposes of ORS 60.825 to 60.845, a person shall be considered to be the owner
of and to own any shares:
(a) Which the person or any of the persons
affiliates or associates, directly or indirectly, have the power to vote or
dispose of, including voting or dispositive power pursuant to any agreement,
arrangement or understanding, whether or not in writing;
(b) Over which the person or any of the
persons affiliates or associates, directly or indirectly, have the right to
acquire voting or dispositive power, whether the right is exercisable
immediately or only after the passage of time, pursuant to any agreement,
arrangement or understanding, whether or not in writing, or upon the exercise
of conversion rights, exchange rights, rights, warrants or options, or
otherwise; or
(c) Which are owned, directly or
indirectly, by any other person, or any affiliate or associate of the person,
with which the person, or any affiliates or associates of the person, have any
agreement, arrangement or understanding, whether or not in writing, for the
purpose of acquiring, holding, voting or disposing of any securities of the
corporation.
(2) For purposes of subsection (1) of this
section, a person shall not be considered to be the owner of or to own any
shares:
(a) If an agreement, arrangement or
understanding to vote shares arises solely from a revocable proxy or consent
given to the person in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the applicable rules and regulations of
the Securities Exchange Act of 1934;
(b) Tendered pursuant to a tender or
exchange offer made by or on behalf of the person or any of the persons
affiliates or associates until any tendered shares are accepted for purchase or
exchange; or
(c) Acquired by a person engaged in
business as an underwriter of securities through the persons participation in
good faith in a firm commitment underwriting until the expiration of 40 days
after the date of the acquisition of the shares. [1991 c.40 §3]
60.835
Prohibited business combinations. Notwithstanding any other provision of this chapter, a corporation
shall not engage in any business combination with any interested shareholder
for a period of three years following the date that the shareholder became an
interested shareholder, unless:
(1) Prior to that date the board of
directors of the corporation approved either the business combination or the
transaction which resulted in the shareholder becoming an interested
shareholder;
(2) Upon consummation of the transaction
which resulted in the shareholder becoming an interested shareholder, the
interested shareholder owned at least 85 percent of the voting stock of the corporation
outstanding at the time the transaction commenced, excluding for purposes of
determining the number of shares outstanding those shares owned by:
(a) Persons who are directors and also
officers; and
(b) Employee share plans in which employee
participants do not have the right to determine confidentially whether shares
held subject to the plan will be tendered in a tender or exchange offer; or
(3) On or subsequent to the date, the
business combination is approved by the board of directors and authorized at an
annual or special meeting of shareholders, and not by written consent, by the
affirmative vote of at least 66-2/3 percent of the outstanding voting stock
which is not owned by the interested shareholder. [1991 c.40 §4; 1991 c.883 §18;
1991 c.927 §5]
60.840
Exceptions to ORS 60.835.
(1) ORS 60.835 shall not apply if:
(a) The corporations original articles of
incorporation contain a provision expressly electing not to be governed by ORS
60.825 to 60.845;
(b) The corporation, by action of its
board of directors, adopts an amendment to its bylaws within 90 days after
April 4, 1991, expressly electing not to be governed by ORS 60.825 to 60.845.
The amendment shall not be further amended by the board of directors;
(c) The corporation, by action of its
shareholders, adopts an amendment to its articles of incorporation or bylaws
expressly electing not to be governed by ORS 60.825 to 60.845, provided that,
in addition to any other vote required by law, the amendment to the articles of
incorporation or bylaws must be approved by the affirmative vote of a majority
of the shares entitled to vote. An amendment adopted pursuant to this paragraph
shall not be effective until 12 months after the adoption of the amendment and
shall not apply to any business combination between the corporation and any
person who became an interested shareholder of the corporation on or prior to
the adoption of the amendment. A bylaw amendment adopted pursuant to this
paragraph shall not be further amended by the board of directors;
(d) The corporation does not have a class
of voting stock that is:
(A) Listed on a national securities
exchange;
(B) Authorized for quotation on an
interdealer quotation system of a registered national securities association;
or
(C) Held of record by more than 2,000
shareholders; or
(e) A shareholder becomes an interested
shareholder inadvertently and:
(A) As soon as practicable divests
sufficient shares so that the shareholder ceases to be an interested
shareholder; and
(B) Would not, at any time within the
three-year period immediately prior to a business combination between the
corporation and the shareholder, have been an interested shareholder, but for
the inadvertent acquisition.
(2) Subsection (1)(d) of this section does
not apply if anything described in subsection (1)(d) of this section results
from action taken, directly or indirectly, by an interested shareholder or from
a transaction in which a person becomes an interested shareholder.
(3) Notwithstanding subsection (1) of this
section, a corporation may elect by a provision of its original articles of
incorporation or any amendment thereto to be governed by ORS 60.825 to 60.845,
except that any amendment to the articles of incorporation shall not apply to
restrict a business combination between the corporation and an interested
shareholder of the corporation if the interested shareholder became an
interested shareholder prior to April 4, 1991. [1991 c.40 §5]
60.845
Greater vote of shareholders prohibited. No provision of any articles of incorporation or bylaws shall require
a greater vote of shareholders than that specified in ORS 60.825 to 60.845 for
any vote of shareholders required by ORS 60.825 to 60.845. [1991 c.40 §6]
MISCELLANEOUS
60.951
Short title. This chapter
shall be known and may be cited as the Oregon Business Corporation Act. [1987
c.52 §1]
60.952
Court proceeding by shareholder in close corporation; conditions; court-ordered
remedies; share purchase; expenses. (1) In a proceeding by a shareholder in a corporation that does not
have shares that are listed on a national securities exchange or that are
regularly traded in a market maintained by one or more members of a national or
affiliated securities association, the circuit court may order one or more of
the remedies listed in subsection (2) of this section if it is established
that:
(a) The directors are deadlocked in the
management of the corporate affairs, the shareholders are unable to break the
deadlock and irreparable injury to the corporation is threatened or being
suffered, or the business and affairs of the corporation can no longer be
conducted to the advantage of the shareholders generally, because of the
deadlock;
(b) The directors or those in control of
the corporation have acted, are acting or will act in a manner that is illegal,
oppressive or fraudulent;
(c) The shareholders are deadlocked in
voting power and have failed, for a period that includes at least two
consecutive annual meeting dates, to elect successors to directors whose terms
have expired; or
(d) The corporate assets are being
misapplied or wasted.
(2) The remedies that the court may order
in a proceeding under subsection (1) of this section include but are not
limited to the following:
(a) The performance, prohibition,
alteration or setting aside of any action of the corporation or of its
shareholders, directors or officers or any other party to the proceeding;
(b) The cancellation or alteration of any
provision in the corporations articles of incorporation or bylaws;
(c) The removal from office of any
director or officer;
(d) The appointment of any individual as a
director or officer;
(e) An accounting with respect to any
matter in dispute;
(f) The appointment of a custodian to
manage the business and affairs of the corporation, to serve for the term and
under the conditions prescribed by the court;
(g) The appointment of a provisional
director to serve for the term and under the conditions prescribed by the
court;
(h) The submission of the dispute to
mediation or another form of nonbinding alternative dispute resolution;
(i) The issuance of distributions;
(j) The award of damages to any aggrieved
party;
(k) The purchase by the corporation or one
or more shareholders of all of the shares of one or more other shareholders for
their fair value and on the terms determined under subsection (5) of this
section;
(L) The retention of jurisdiction of the
case by the court for the protection of the shareholder who filed the
proceeding; or
(m) The dissolution of the corporation if
the court determines that no remedy specified in paragraphs (a) to (L) of this
subsection or other alternative remedy is sufficient to resolve the matters in
dispute. In determining whether to dissolve the corporation, the court shall
consider among other relevant evidence the financial condition of the
corporation but may not refuse to dissolve the corporation solely because it
has accumulated earnings or current operating profits.
(3) The remedies set forth in subsection
(2) of this section shall not be exclusive of other legal and equitable
remedies that the court may impose. Except as provided in this subsection, the
shareholders of a corporation may, pursuant to an agreement described in ORS
60.265, agree to limit or eliminate any of the remedies set forth in subsection
(2) of this section. The remedies set forth in subsection (2)(e), (j) and (m)
of this section may not be eliminated.
(4) In determining the appropriate
remedies to order under subsection (2) of this section, the court may take into
consideration the reasonable expectations of the corporations shareholders as
they existed at the time the corporation was formed and developed during the
course of the shareholders relationship with the corporation and with each
other. The court shall endeavor to minimize the harm to the business of the
corporation.
(5)(a) If the court orders a share
purchase, the court shall:
(A) Determine the fair value of the
shares, with or without the assistance of appraisers, taking into account any
impact on the value of the shares resulting from the actions giving rise to a
proceeding under subsection (1) of this section;
(B) Consider any financial or legal
constraints on the ability of the corporation or the purchasing shareholder to
purchase the shares;
(C) Specify the terms of the purchase,
including, if appropriate, terms for installment payments, interest at the rate
and from the date determined by the court to be equitable, subordination of the
purchase obligation to the rights of the corporations other creditors,
security for a deferred purchase price and a covenant not to compete or other
restriction on the seller;
(D) Require the seller to deliver all of
the sellers shares to the purchaser upon receipt of the purchase price or the
first installment of the purchase price; and
(E) Retain jurisdiction to enforce the
purchase order by, among other remedies, ordering the corporation to be
dissolved if the purchase is not completed in accordance with the terms of the
purchase order.
(b) The share purchase ordered under this
subsection shall be consummated within 20 days after the date the order becomes
final unless before that time the corporation files with the court a notice of
its intention to dissolve and articles of dissolution are properly filed with the
Secretary of State within 50 days after filing the notice with the court.
(c) After the purchase order is entered
and before the purchase price is fully paid, any party may petition the court
to modify the terms of the purchase, and the court may do so if the court finds
that the modifications are equitable.
(d) Unless the purchase order is modified
by the court, the selling shareholder shall have no further rights as a
shareholder from the date the seller delivers all of the shareholders shares
to the purchaser or such other date specified by the court.
(e) If the court orders shares to be
purchased by one or more other shareholders, in allocating the shares to be
purchased by the other shareholders, unless equity requires otherwise, the
court shall attempt to preserve the existing distribution of voting rights and
other designations, preferences, qualifications, limitations, restrictions and
special or relative rights among the holders of the class or classes of shares
and may direct that holders of a specific class or classes not participate in
the purchase.
(6) At any time within 90 days after the
filing of a proceeding under subsection (1) of this section, or at such time
determined by the court to be equitable, the corporation or one or more shareholders
may elect to purchase all of the shares owned by the shareholder who filed the
proceeding for their fair value. An election to purchase under this subsection
shall state in writing the amount that the electing party will pay for the
shares. The following apply:
(a) The election to purchase shall be
irrevocable unless the court determines that it is equitable to set aside or
modify the election.
(b) If the election to purchase is filed
by one or more shareholders, the corporation shall, within 10 days thereafter,
give written notice to all shareholders. The notice shall state the name of the
shareholder who filed the proceeding under subsection (1) of this section and
the number of shares owned by that shareholder, the name of each electing
shareholder and the number of shares owned by that electing shareholder and the
amount that each electing shareholder will pay for the shares. The notice also
must advise the recipients of their right to join in the election to purchase
shares. Shareholders who wish to participate must file notice of their
intention to join in the election to purchase not later than 30 days after the
date of the notice to them or at such time as the court in its discretion may
allow. All shareholders who have filed an election or notice of their intention
to participate in the election to purchase thereby become parties to the
proceeding under subsection (1) of this section and shall participate in the
purchase in proportion to their ownership of shares as of the date the first election
was filed, unless the shareholders otherwise agree or the court otherwise
directs.
(c) The court in its discretion may allow
the corporation and shareholders to file an election to purchase the shares of
the shareholder who filed the proceeding under subsection (1) of this section
at a price higher than the amount previously offered. If the court does so, it
shall allow other shareholders an opportunity to join in the election to
purchase at the higher price in accordance with their proportionate ownership
interest.
(d) After an election to purchase has been
filed by the corporation or one or more shareholders, the proceeding filed
under subsection (1) of this section may not be discontinued or settled, nor
may the shareholder who filed the proceeding sell or otherwise dispose of the
shareholders shares, unless the court determines that it would be equitable to
the corporation and the shareholders, other than the petitioner, to permit the
discontinuance, settlement, sale or other disposition. In considering whether
equity exists to approve any settlement, the court may take into consideration
the reasonable expectations of the shareholders as referred to in subsection
(4) of this section, including any existing agreement among the shareholders.
(e) If, within 30 days of the filing of
the latest election to purchase allowed by the court, the parties reach
agreement as to the fair value and terms of purchase of the shares of the
shareholder who filed the proceeding under subsection (1) of this section, the
court shall enter an order directing the purchase of shares upon the terms and
conditions agreed to by the parties.
(f) If the parties are unable to reach an
agreement as described in paragraph (e) of this subsection, the court, upon
application of any party, shall stay the proceeding under subsection (1) of
this section and shall, under subsection (5) of this section, determine the
fair value and terms of purchase of the shares of the shareholder who filed the
proceeding as of the day before the date on which the proceeding was filed or
as of such other date as the court deems appropriate under the circumstances.
(7) In any proceeding under subsection (1)
of this section, the court shall allow reasonable compensation to the
custodian, provisional director, appraiser or other such person appointed by
the court for services rendered and reimbursement or direct payment of
reasonable costs and expenses. Amounts described in this subsection shall be
paid by the corporation. [2001 c.315 §60]
60.954
Reservation of power to amend or repeal. All or part of this chapter may be amended or repealed at any time and
all domestic and foreign corporations subject to this chapter are governed by
the amendment or repeal. [1987 c.52 §2]
60.957
Application to existing domestic corporation. This chapter applies to all domestic corporations in existence on June
15, 1987, that were incorporated under any general statute of this state
providing for incorporation of corporations for profit if power to amend or
repeal the statute under which the corporation was incorporated was reserved. [1987
c.52 §176]
60.961
Application to qualified foreign corporations. A foreign corporation authorized to transact
business in this state on June 15, 1987, is subject to this chapter but is not
required to apply for new authority to transact business under this chapter. [1987
c.52 §177]
60.964
Saving provisions. (1)
Except as provided in subsections (2), (3) and (4) of this section, the repeal
of a statute by this chapter does not affect:
(a) The operation of the statute or any
action taken under it before its repeal;
(b) Any ratification, right, remedy,
privilege, obligation or liability acquired, accrued or incurred under the
statute before its repeal;
(c) Any violation of the statute, or any
penalty, forfeiture or punishment incurred because of the violation, before its
repeal; or
(d) Any proceeding, reorganization or
dissolution commenced under the statute before its repeal. The proceeding,
reorganization or dissolution may be completed in accordance with the statute
as if it had not been repealed.
(2) The provisions of ORS 60.387 to 60.411
shall apply to all indemnification made by a corporation after June 15, 1987
and all other actions regarding indemnification taken by or on behalf of a
corporation or by a court after June 15, 1987, including all indemnification
made and other actions taken after June 15, 1987, with respect to claims that
arose or matters that occurred prior to June 15, 1987, or pursuant to any
provisions of any articles of incorporation, bylaws, resolutions or agreements
in effect prior to June 15, 1987.
(3) If a penalty or punishment imposed for
violation of a statute repealed by this chapter is reduced by this chapter, the
penalty or punishment, if not already imposed, shall be imposed in accordance
with this chapter.
(4) This chapter shall apply to any
amendment to a corporations articles of incorporation filed after June 15,
1987, even if shareholder approval of such amendment occurred prior to the
effective date. [1987 c.52 §178]
60.967
Corporations incorporated under special acts. The shareholders of any private incorporation incorporated by any
special Act of the Legislative Assembly before December 31, 1953, may
incorporate themselves under this chapter at any time after June 15, 1987,
while the corporation exists for the purpose of carrying on the enterprise,
business, pursuit or occupation for which they were specially incorporated. The
filing of the articles of incorporation shall be deemed a surrender of the
special incorporation, but not of any vested right thereunder, and thereafter
the corporation shall have the powers and privileges, and be subject to the
liabilities and limitations provided by this chapter and not otherwise. [1987
c.52 §179; 1989 c.1040 §35]
60.971
Severability. If any
provision of this chapter or its application to any person or circumstance is
held invalid by a court of competent jurisdiction, the invalidity does not
affect other provisions or applications of this chapter that can be given
effect without the invalid provision or application, and to this end the
provisions of this chapter are severable. [1987 c.52 §180]
PENALTY
60.990 [(Enacted in 1903) repealed by 1953 c.549 §138;
60.990 (enacted by 1987 c.52 §175) renumbered 60.992 in 1993]
60.992
Penalty for signing false document. (1) A person commits the crime of falsely signing a document for
filing if the person signs a document knowing it is false in any material
respect with intent that the document be delivered to the office for filing.
(2) Falsely signing a document for filing
is a Class B misdemeanor. [Formerly 60.990]
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