Chapter 60 — Private
Corporations
2011 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 State’s 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 Corporation’s
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 Payment
of director’s expenses in connection with proceeding
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
SALE OF ASSETS
60.531 Sale
of assets in regular course of business; mortgage of assets
60.534 Sale
of assets other than in regular course of business
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; updates; rules
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 the writing. For example, a writing
printed in italics, boldface or contrasting color, typed in capitals or
underlined is conspicuous.
(5)
“Corporation” or “domestic corporation” means a corporation for profit
incorporated under or subject to the provisions of this chapter that is not a
foreign corporation.
(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 corporation’s own shares, or incurrence of indebtedness by a
corporation to or for the benefit of the corporation’s shareholders in respect
of any of the corporation’s 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, unless the director accepts
duties that make the director also an employee.
(14)
“Entity” includes a corporation, foreign corporation, nonprofit corporation,
profit and nonprofit unincorporated association, business trust, partnership,
two or more persons having a joint or common economic interest, any state, the
United States, a federally recognized Native American or American Indian tribal
government and any foreign government.
(15)
“Foreign corporation” means a corporation for profit incorporated under laws
other than the laws of this state.
(16)
“Foreign limited liability company” means an entity that is an unincorporated
association organized under laws other than the laws of this state and that is
organized under a statute under which an association may be formed that affords
to each of the entity’s members limited liability with respect to liabilities
of the entity.
(17)
“Foreign nonprofit corporation” means a corporation not for profit organized
under laws other than the laws of this state.
(18)
“Foreign professional corporation” means a professional corporation organized
under laws other than the laws of 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 the corporation’s 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 United States, includes a state,
commonwealth, territory and insular possession of the United States and the
agencies and governmental subdivisions of the state, commonwealth, territory or
insular possession.
(32)
“Subscriber” means a person who subscribes for shares in a corporation, whether
before or after incorporation.
(33)
“United States” includes a district, authority, bureau, commission, department
and any other agency of the United States.
(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; 2009 c.14 §1; 2009 c.294 §4]
(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 State’s 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 State’s 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 State’s 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 State’s
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 State’s
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 corporation’s corporate name or the foreign corporation’s
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 shareholder’s address shown in the corporation’s
current record of shareholders or the director’s address shown in the
corporation’s 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 corporation’s 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 director’s 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 State’s 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 corporation’s
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
officer’s 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 corporation’s
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 corporation’s 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 shareholder’s 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 United States with respect to the right to acquire and protect
trade names. [1987 c.52 §26]
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 agent’s 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
corporation’s mailing address or the corporation’s 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 corporation’s 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 corporation’s 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 corporation’s 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 corporation’s
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 corporation’s unissued shares upon the decision of the board of directors
to issue them.
(b)
A shareholder may waive the shareholder’s 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 Corporation’s 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 corporation’s 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 corporation’s 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
corporation’s 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 corporation’s indebtedness to a shareholder incurred by reason of a
distribution made in accordance with this section is at parity with the
corporation’s 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
corporation’s principal office.
(3)
The failure to hold an annual meeting at the time stated in or fixed in
accordance with a corporation’s 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 the board of directors of the corporation or a person authorized to
do so by the articles of incorporation or bylaws; or
(b)
Except as provided in this paragraph and in subsection (2) of this section, if
the holders of at least 10 percent of all votes entitled to be cast on any
issue proposed for consideration at the proposed special meeting sign, date and
deliver to the corporation’s secretary one or more written demands for the
meeting describing the purpose or purposes for which the meeting 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 for consideration. Unless otherwise provided in the articles of
incorporation, a shareholder who signed the original demand for a special
meeting may revoke the shareholder’s demand by signing a writing that contains
a revocation. The revocation is effective if the corporation receives the
writing before the corporation receives a demand sufficient to require the
corporation to hold a special meeting.
(2)
A publicly traded corporation shall hold a special meeting at the demand of
shareholders of the publicly traded corporation only if the articles of
incorporation or bylaws authorize the shareholders to demand a special meeting.
The articles of incorporation or bylaws may also specify what percentage of
votes entitled to be cast on an issue proposed for consideration at the special
meeting will be necessary to require the publicly traded corporation to hold
the special meeting.
(3)
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.
(4)
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
corporation’s principal office.
(5)
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.
(6)
As used in this section, “publicly traded corporation” means a corporation the
shares of which are traded on an established exchange or securities market that
is subject to the regulatory authority of a state, the United States, a foreign
government or an agency of a state, the United States or a foreign government. [1987
c.52 §50; 2003 c.80 §3; 2009 c.362 §1]
60.207 Court-ordered meeting.
(1) The circuit court of the county where a corporation’s 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 corporation’s 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 corporation’s 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 shareholder’s 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 shareholder’s 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 shareholder’s 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 shareholder’s 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 inspector’s 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 corporation’s
principal office or at a place identified in the meeting notice in the city
where the meeting will be held. A shareholder, the shareholder’s 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 shareholder’s 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 shareholder’s 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 shareholder’s 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 corporation’s 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 corporation’s 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 shareholder’s 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 shareholder’s designated officer, director, employee or
agent may execute a writing by:
(A)
Signing it; or
(B)
Causing the shareholder’s 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 shareholder’s 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 proxy’s 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 proxy’s 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 proxy’s authority
appearing on the face of the authorization form or electronic transmission, a
corporation is entitled to accept the proxy’s 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 signatory’s 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 co-owners and the
person signing appears to be acting on behalf of all co-owners.
(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 signatory’s 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 corporation’s principal office.
(2)
A voting trust becomes effective on the date the first shares subject to the
trust are registered in the trustee’s 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 trustee’s 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 corporation’s 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 court’s approval. If the court determines that a proposed discontinuance
or settlement will substantially affect the interest of the corporation’s
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 corporation’s 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 director’s
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 director’s term, the director continues to serve
until the director’s 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 director’s 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 corporation’s 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 director’s 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 director’s 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
director’s arrival, to holding the meeting or transacting business at the
meeting;
(b)
The director’s 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 member’s
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 person’s professional or expert competence;
or
(c)
A committee of the board of directors of which the director is not a member if
the director reasonably believes the committee merits confidence.
(3)
A director is not acting in good faith if the director has knowledge concerning
the matter in question that makes reliance otherwise permitted by subsection
(2) of this section unwarranted.
(4)
A director is not liable for any action taken as a director, or any failure to
take any action, if the director performed the duties of the director’s office
in compliance with this section.
(5)
When evaluating any offer of another party to make a tender or exchange offer
for any equity security of the corporation, or any proposal to merge or
consolidate the corporation with another corporation or to purchase or
otherwise acquire all or substantially all the properties and assets of the
corporation, the directors of the corporation may, in determining what they
believe to be in the best interests of the corporation, give due consideration
to the social, legal and economic effects on employees, customers and suppliers
of the corporation and on the communities and geographical areas in which the
corporation and its subsidiaries operate, the economy of the state and nation,
the long-term as well as short-term interests of the corporation and its
shareholders, including the possibility that these interests may be best served
by the continued independence of the corporation, and other relevant factors. [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 director’s interest in the transaction if any one of the
following is true:
(a)
The material facts of the transaction and the director’s 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 director’s 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 corporation’s 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 borrower’s 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 person’s 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 predecessor’s
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
corporation’s 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 corporation’s request if the
director’s 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
corporation’s 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 corporation’s request if the officer’s
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 against liability incurred in a proceeding to which the
individual was made a party because the individual is or was a director if:
(a)
The conduct of the individual was in good faith;
(b)
The individual reasonably believed that the individual’s conduct was in the
best interests of the corporation, or at least was not opposed to the
corporation’s best interests; and
(c)
In the case of a criminal proceeding, the individual did not have reasonable
cause to believe the individual’s conduct was unlawful.
(2)
A director’s 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)
Terminating a proceeding by judgment, order, settlement or conviction or upon a
plea of nolo contendere or
the equivalent of nolo contendere
does not, of itself, determine 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 in connection
with:
(a)
A proceeding by or in the right of the corporation in which the director was
adjudged liable to the corporation; or
(b)
A proceeding that charged the director with and adjudged the director liable
for improperly receiving a personal benefit.
(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.
(6)(a)
A corporation that provides indemnification to a director in accordance with
the corporation’s articles of incorporation or bylaws may not amend the articles
of incorporation or bylaws so as to eliminate or impair the director’s right to
indemnification after an act or omission occurs that subjects the director to a
proceeding or to liability for which the director seeks indemnification under
the terms of the articles of incorporation or bylaws.
(b)
Notwithstanding the prohibition set forth in paragraph (a) of this subsection,
a corporation may eliminate or impair a director’s right to indemnification if
at the time the act or omission occurred the corporation’s articles of
incorporation or bylaws explicitly authorized the corporation to eliminate or
impair the right after an act or omission occurs. [1987 c.52 §95; 2011 c.227 §1]
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 Payment of director’s expenses in connection
with proceeding. (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 director’s
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 director’s behalf, to repay the advance if the director is
ultimately determined not to have met 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)
An 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.
(4)(a)
A corporation that authorizes payments in accordance with subsection (3) of
this section may not amend or rescind the articles of incorporation, bylaws or
resolution that authorizes the payments so as to eliminate or impair a director’s
right to payments after an act or omission occurs that subjects the director to
a proceeding for which the director seeks payment.
(b)
Notwithstanding the prohibition set forth in paragraph (a) of this subsection,
a corporation may eliminate or impair a director’s right to payments if at the
time the act or omission occurred the corporation’s articles of incorporation,
bylaws or resolution explicitly authorized the corporation to eliminate or
impair the right after an act or omission occurs. [1987 c.52 §97; 2011 c.227 §2]
60.401 Court-ordered indemnification.
Unless the corporation’s 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 director’s
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 corporation’s 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 corporation’s 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 corporation’s power to pay or reimburse
expenses incurred by a director in connection with the director’s 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 corporation’s board
of directors may adopt one or more amendments to the corporation’s 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 corporation’s 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 classes or series of shares
to vote as separate voting groups under this section would affect those two or
more classes or series in the same or a substantially similar way, the shares
of all the classes or series so affected must vote together as a single voting
group on the proposed amendment, unless the articles of incorporation provide
or the board of directors requires otherwise.
(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; 2009 c.13 §1]
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 corporation’s 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 amendment’s 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 corporation’s 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 corporation’s 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 court’s 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 corporation’s 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 corporation’s board of
directors may amend or repeal the corporation’s 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 corporation’s shareholders may amend or repeal the corporation’s 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 Oregon business entity or,
for a foreign business entity, a document equivalent to the following:
(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) A business entity may be converted to a corporation organized under this
chapter.
(b)
A corporation organized under this chapter may be converted to another business
entity organized under the laws of this state if the statutes that govern the
other business entity permit the conversion.
(c)
A business entity may perform a conversion described in paragraph (a) or (b) of
this subsection by approving a plan of conversion and filing articles of
conversion.
(2)
A corporation organized under this chapter may be converted to a business
entity organized under the laws of another jurisdiction if:
(a)
The laws of the other jurisdiction permit the conversion;
(b)
The converting corporation approves a plan of conversion;
(c)
Articles of conversion are filed in this state;
(d)(A)
The converted business entity submits an application for filing to the
Secretary of State to transact business as a foreign business entity of the
type into which the business entity converted unless the converted business
entity does not intend to continue to transact business in this state; and
(B)
The converted business entity meets all other requirements the laws of this
state prescribe for authorization to transact business as a foreign business
entity of the type into which the business entity converted; and
(e)
The corporation complies with all requirements that the laws of the other
jurisdiction impose with respect to the conversion.
(3)
The plan of conversion must 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 that the statutes that govern converted business
entities of the type into which the business entity converted require in the
organizational document of the converted business entity.
(4)
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; 2011 c.147 §1]
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 entity’s liabilities, and after conversion is an owner
normally protected from personal liability, then such owner shall continue to
be personally liable for the business entity’s 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 shareholder’s 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 owner’s 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 the
parent, or may merge the parent 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, not later than 10 days after the effective date of the merger,
shall:
(A)
Notify each shareholder of the subsidiary that the merger has become effective;
and
(B)
Mail a copy or a summary of the plan of merger to each shareholder of the
subsidiary that does not waive this mailing requirement in writing.
(c)
Articles of merger under this subsection may not contain amendments to the
articles of incorporation of the parent, 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, not later than 10 days after the effective date of the merger,
shall:
(A)
Notify each shareholder of the subsidiary and each shareholder of the parent
that the merger has become effective; and
(B)
Mail a copy or summary of the plan of merger to each shareholder of the
subsidiary and each shareholder of the parent that does not waive this mailing
requirement in writing.
(c)
The surviving corporation shall be a domestic corporation. [1987 c.52 §118;
1993 c.403 §8; 1997 c.392 §1; 2009 c.355 §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 entity’s obligations, and after merger is an owner normally protected
from personal liability, then such owner shall continue to be personally liable
for the business entity’s 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 owner’s 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]
SALE OF ASSETS
60.531 Sale of assets in regular course of
business; mortgage of assets. (1) A
corporation may, on the terms and conditions and for the consideration
determined by the board of directors:
(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 Sale of assets other than in regular
course of business. (1) A corporation may sell,
lease, exchange or otherwise dispose of all or substantially all of its
property, with or without the goodwill, other than in the usual and regular
course of business, on the terms and conditions and for the consideration
determined by the corporation’s board of directors, if the board of directors
proposes and its shareholders approve the proposed transaction.
(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 dissenter’s 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 shareholder’s 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 dissenter’s 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 shareholder’s
shares under ORS 60.551 to 60.594 may not challenge the corporate action
creating the shareholder’s 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 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 effective date of the merger 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; 2009 c.355 §2]
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 shareholder’s 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 shareholder’s
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 shareholder’s behalf only if:
(a)
The beneficial shareholder submits to the corporation the record shareholder’s
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 shareholder’s intent to demand payment for the
shareholder’s 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 shareholder’s 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 shareholder’s certificates in
accordance with the terms of the notice.
(2)
The shareholder who demands payment and deposits the shareholder’s 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 shareholder’s share
certificates where required, each by the date set in the dissenters’ notice, is
not entitled to payment for the shareholder’s 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 shareholder’s shares, plus accrued interest.
(2)
The payment must be accompanied by:
(a)
The corporation’s 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 corporation’s estimate of the fair value of the shares;
(c)
An explanation of how the interest was calculated;
(d)
A statement of the dissenter’s 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 dissenter’s 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 dissenter’s own estimate
of the fair value of the dissenter’s shares and amount of interest due, and
demand payment of the dissenter’s estimate, less any payment under ORS 60.577
or reject the corporation’s offer under ORS 60.584 and demand payment of the
dissenter’s estimate of the fair value of the dissenter’s 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 dissenter’s 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 dissenter’s demand in writing under
subsection (1) of this section within 30 days after the corporation made or offered
payment for the dissenter’s 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 corporation’s principal office is located, or if the principal
office is not in this state, where the corporation’s 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 dissenter’s
shares, plus interest, exceeds the amount paid by the corporation; or
(b)
The fair value, plus accrued interest, of the dissenter’s 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 corporation’s 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 corporation’s 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 corporation’s board of directors, or incorporators, revoked the
dissolution, a statement to that effect;
(e)
If the corporation’s 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 the corporation’s corporate existence but
may not carry on any business except that appropriate to wind up and liquidate
the corporation’s business and affairs, including:
(a)
Collecting the corporation’s assets;
(b)
Disposing of the corporation’s properties that will not be distributed in kind
to the corporation’s shareholders;
(c)
Discharging or making provision for discharging the corporation’s liabilities;
(d)
Distributing the corporation’s remaining property among the corporation’s
shareholders according to the shareholders’ interests;
(e)
Adopting a plan of merger; and
(f)
Doing other acts necessary to wind up and liquidate the corporation’s business
and affairs.
(2)
Dissolution of a corporation does not:
(a)
Transfer title to the corporation’s property;
(b)
Prevent transfer of the corporation’s shares or securities, although the
authorization to dissolve may provide for closing the corporation’s share
transfer records;
(c)
Subject the corporation’s 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 the
corporation’s directors or officers or both or change provisions for amending
the corporation’s bylaws;
(e)
Prevent commencement of a proceeding by or against the corporation in the
corporation’s 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;
2011 c.147 §2]
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 corporation’s 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 shareholder’s pro rata share of
the claim or the corporate assets distributed to the shareholder in
liquidation, whichever is less. A shareholder’s 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 corporation’s 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 that the Secretary of
State 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 must:
(a)
State the name of the corporation and the effective date of the corporation’s
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 corporation’s name satisfies the requirements of ORS 60.094,
the Secretary of State shall reinstate the corporation.
(3)
When effective, the reinstatement relates back to and takes effect as of the
effective date of the administrative dissolution and the corporation resumes
carrying on the corporation’s business as if the administrative dissolution had
never occurred.
(4)
The Secretary of State may waive the requirement under subsection (1) of this
section that the corporation apply for reinstatement within five years after
the date of administrative dissolution if the corporation requests the waiver
and provides evidence of the corporation’s continued existence as an active
concern during the period of administrative dissolution. [1987 c.52 §148; 1995
c.215 §7; 2011 c.147 §3]
60.657 Appeal from denial of reinstatement.
(1) If the Secretary of State denies a corporation’s 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 creditor’s 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 creditor’s 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 Marion County. Venue for a proceeding brought by any other party named
in ORS 60.661 or 60.952 lies in the county where a corporation’s principal
office is located or, if the principal office is not in this state, where its
registered office is or was last located.
(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 receiver’s 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 receiver’s or custodian’s 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 corporation’s 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 corporation’s 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 of the Secretary of State for filing. The application
must set forth:
(a)
The name of the foreign corporation or, if the name the foreign corporation
uses 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 the foreign corporation is
incorporated;
(c)
The foreign corporation’s registry number in the state or country under whose
law the foreign corporation is incorporated;
(d)
The foreign corporation’s date of incorporation and period of duration if the
period is not perpetual;
(e)
The address, including street and number and mailing address, if different, of
the foreign corporation’s principal office;
(f)
The address, including street and number, of the foreign corporation’s
registered office in this state and the name of the foreign corporation’s
registered agent at the registered office; and
(g)
The names and respective addresses of the president and secretary of the
foreign corporation.
(2)(a)
Except as provided in paragraph (b) of this subsection, 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 the foreign corporation is incorporated.
(b)
A foreign corporation need not submit a certificate of existence or document in
accordance with paragraph (a) of this subsection if the official who has
custody of corporate records in the state or country under whose law the
foreign corporation is incorporated provides free access via the Internet to a
searchable database that contains evidence of corporate registrations. [1987
c.52 §157; 2011 c.147 §4]
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 agent’s 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.