Chapter 0315

Chapter 315 Oregon Laws 2001

AN ACT

SB 118

Relating to business organizations; creating new provisions; and amending ORS 56.080, 60.001, 60.111, 60.211, 60.472, 60.476, 60.478, 60.481, 60.494, 60.661, 60.664, 60.667, 60.671, 60.721, 62.015, 62.155, 62.607, 62.611, 62.613, 62.617, 63.001, 63.047, 63.111, 63.155, 63.470, 63.476, 63.479, 63.481, 63.721, 65.001, 65.111, 65.637, 65.721, 67.342, 67.346, 67.348, 67.360, 70.005, 70.025, 70.435, 70.505, 70.515, 70.520, 70.525, 70.610, 271.330, 307.518, 554.082 and 750.635.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 60.494 is amended to read:

60.494. (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 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.

SECTION 2. ORS 60.478 is amended to read:

60.478. (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.

SECTION 3. ORS 62.613 is amended to read:

62.613. (1) When a conversion to or from a cooperative pursuant to ORS 62.607 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;

(f) Liability of an owner for obligations of the business entity shall be determined:

(A) As to liabilities incurred by the business entity prior to conversion, according to the status of the owner prior to conversion; and

(B) As to liabilities incurred by the business entity after conversion, according to the status of the owner after conversion, except as provided in paragraph (g) of this subsection;

(h) Unless the converted business entity is a partnership, the registration of an assumed business name of a business entity under 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, in the case of business entities other than cooperatives, to the rights provided in the statutes 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.

SECTION 4. ORS 63.479 is amended to read:

63.479. (1) When a conversion to or from a limited liability company pursuant to ORS 63.470 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;

(f) Liability of an owner for obligations of the business entity shall be determined:

(A) As to liabilities incurred by the business entity prior to conversion, according to laws applicable prior to conversion; and

(B) As to liabilities incurred by the business entity after conversion, according to laws applicable after conversion, except as provided in paragraph (g) of this subsection;

(2) Owners of the business entity that converted are entitled to:

(a) In the case of limited liability companies, only the rights provided in the plan of conversion; and

(b) In the case of owners of business entities other than limited liability companies, the rights provided in the plan of conversion and in the statutes 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.

SECTION 5. ORS 67.348 is amended to read:

67.348. (1) When a conversion to or from a partnership pursuant to ORS 67.342 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;

(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 obligations incurred prior to conversion, according to the laws applicable prior to conversion, except as provided in paragraph (g) of this subsection; and

(B) As to obligations incurred after conversion, according to the laws applicable after conversion, except as provided in paragraph (h) of this subsection;

(g) If the converting business entity is a partnership other than a limited liability partnership and its obligations incurred before the conversion are not satisfied by the converted business entity, the persons who were partners of the converting business entity immediately before the effective date of the conversion shall contribute the amount necessary to satisfy the converting business entity’s obligations in the manner provided in ORS 67.315 as if the converting business entity were dissolved;

(h) If prior to conversion an owner of a business entity was a partner of a partnership or general partner of a limited partnership or a foreign limited partnership, and was personally liable for the business entity’s obligations, 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 obligations 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

(i) [The registration of an assumed business name of a business entity under ORS chapter 648 shall continue as the assumed business name of the converted business entity.] The registrants of an assumed business name that is used as the name of a partnership that is a converting business entity shall file an application to cancel the registration under ORS chapter 648, and the converted business entity, if it intends to continue using the name, shall file an assumed business name registration for the 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) Any partner who did not vote in favor of the conversion is deemed to have dissociated from the partnership effective immediately before the conversion unless, within 60 days after the later of the effective date of the conversion or the date the partner receives notice of the conversion, the partner notifies the partnership of the partner’s desire not to dissociate. A dissociation under this paragraph is not a wrongful withdrawal; and

(b) In the case of owners of business entities other than partnerships, the rights provided in the statutes 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.

SECTION 6. ORS 70.520 is amended to read:

70.520. (1) When a conversion to or from a limited partnership pursuant to ORS 70.505 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;

(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 obligations incurred prior to conversion, according to the laws applicable prior to conversion, except as provided in paragraph (g) of this subsection; and

(B) As to obligations incurred after conversion, according to the laws applicable after conversion, except as provided in paragraph (h) of this subsection;

(g) If the converting business entity is a limited partnership or a foreign limited partnership and its obligations incurred before the conversion are not satisfied by the converted business entity, the persons who were general partners of the converting business entity immediately before the effective date of the conversion shall contribute the amount necessary to satisfy the converting business entity’s obligations in the manner provided in ORS 67.315, or in the limited partnership statutes of the jurisdiction in which the entity was formed, as if the converting business entity were dissolved; and

(h) If prior to conversion an owner of a business entity was a partner of a partnership or general partner of a limited partnership or foreign limited partnership, and was personally liable for the business entity’s obligations, 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 obligations 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.

(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 a limited partnership, a limited partner who did not vote in favor of the conversion is considered to be a partner who has withdrawn from the limited partnership effective immediately upon the effective date of the conversion unless, within 60 days after the later of the effective date of the conversion or the date the partner receives notice of the conversion, the partner notifies the partnership of the partner’s desire not to withdraw. A withdrawal under this paragraph is not a wrongful withdrawal; and

(b) In the case of owners of business entities other than limited partnerships, the rights provided in the statutes 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.

(3) Unless the converted business entity is a partnership, the registration of an assumed business name of a business entity under ORS chapter 648 shall [not be affected by the conversion] 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.

SECTION 7. ORS 60.476 is amended to read:

60.476. (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.

SECTION 8. ORS 62.611 is amended to read:

62.611. (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 62.035 or the date and time determined pursuant to the statutes governing the business entity that is not a cooperative.

SECTION 9. ORS 63.476 is amended to read:

63.476. (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 63.011 or the date and time determined pursuant to the statutes governing the business entity that is not a limited liability company.

SECTION 10. ORS 67.346 is amended to read:

67.346. (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, the name and type of business entity after conversion and the names and addresses of at least two partners, and shall include the plan of conversion.

(2) The conversion takes effect at the later of the date and time determined pursuant to ORS 67.530 or the date and time determined pursuant to the statutes governing the business entity that is not a partnership.

SECTION 11. ORS 70.515 is amended to read:

70.515. (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 on the latest of:

(a) The filing of the articles of conversion;

(b) If the surviving business entity is not a limited partnership, satisfaction of any additional filing requirements imposed pursuant to the statutes governing that business entity; or

SECTION 12. ORS 60.472 is amended to read:

60.472. (1) A business entity other than a corporation may be converted to a corporation organized under this chapter, and a corporation may be converted to another business entity organized under the laws of this state, [pursuant to this section, by adopting a plan of conversion,] if conversion is permitted by the statutes governing the other business entity, by approving a plan of conversion and filing articles of conversion. A corporation organized under this chapter may be converted to a business entity organized under the laws of another jurisdiction if:

(a) The conversion is permitted by the laws of that jurisdiction;

(b) A plan of conversion is approved by the converting corporation;

(c) Articles of conversion are filed in this state;

(d) The converted business entity submits an application to transact business as a foreign business entity of that type to the Secretary of State for filing and meets all other requirements prescribed under the laws of this state for authorization to transact business as a foreign business entity of that type; and

(e) The corporation complies with all requirements imposed under the laws of the other jurisdiction.

(2) The plan of conversion shall set forth:

(a) The name and type of the business entity prior to conversion;

(b) The name and type of the business entity after conversion;

(d) The manner and basis of converting the ownership interests of each owner into ownership interests or obligations of the converted business entity or any other business entity, or into cash or other property in whole or in part; and

(e) Any additional information required in the organizational document of the converted business entity by the statutes governing that type of business entity.

(3) The plan of conversion may set forth other provisions relating to the conversion.

SECTION 13. ORS 60.481 is amended to read:

60.481. (1)(a) [One or more corporations may merge with one or more business entities, pursuant to this section, if each business entity that is a party to the merger approves a plan of merger and if the merger is permitted by the statutes governing each business entity. The business entity that survives may be a corporation or another business entity.] One or more business entities may merge into a corporation organized under the laws of this state if the merger is permitted by the statutes governing each 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 another jurisdiction, other than a foreign corporation, if:

(A) The merger is permitted by the laws of the other jurisdiction;

(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 the other jurisdiction.

(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;

(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.

SECTION 14. ORS 62.607 is amended to read:

62.607. (1) A business entity other than a cooperative may be converted to a cooperative organized under this chapter, and a cooperative may be converted to another business entity organized under the laws of this state, [pursuant to this section, by adopting a plan of conversion,] if conversion is permitted by the statutes governing the other business entity, by approving a plan of conversion and filing articles of conversion. A cooperative organized under this chapter may be converted to a business entity organized under the laws of another jurisdiction if:

(a) The conversion is permitted by the laws of that jurisdiction;

(b) A plan of conversion is approved by the converting cooperative;

(c) Articles of conversion are filed in this state;

(e) The cooperative complies with all requirements imposed under the laws of the other jurisdiction.

(2) The plan of conversion shall set forth:

(a) The name and type of the business entity prior to conversion;

(b) The name and type of the business entity after conversion;

(d) The manner and basis of converting the ownership interests of each owner into 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) Any additional information required in the organizational document of the converted business entity by the statutes governing that type of business entity.

(3) The plan of conversion may set forth other provisions relating to the conversion.

SECTION 15. ORS 62.617 is amended to read:

62.617. (1) [One or more cooperatives may merge with one or more business entities, pursuant to this section, if each business entity that is a party to the merger approves a plan of merger and if the merger is permitted by the statutes governing each business entity. The business entity that survives may be a cooperative or another business entity.] One or more business entities may merge into a cooperative organized under the laws of this state if the merger is permitted by the statutes governing each 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 cooperative organized under this chapter may be merged into a business entity organized under the laws of another jurisdiction if:

(a) The merger is permitted by the laws of the other jurisdiction;

(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 cooperative complies with all requirements imposed under the laws of the other jurisdiction.

(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;

(e) If any party is a business entity other than a cooperative, any additional information required for a merger by the statutes governing that type of business entity.

(3) The plan of merger may set forth:

(a) Amendments to the articles of incorporation of a cooperative, if the cooperative is the surviving business entity; and

(b) Other provisions relating to the merger.

SECTION 16. ORS 63.470 is amended to read:

63.470. (1) A business entity other than a limited liability company may be converted to a limited liability company organized under this chapter, and a limited liability company may be converted to another business entity organized under the laws of this state, [pursuant to this section, by adopting a plan of conversion,] if conversion is permitted by the statutes governing the other business entity, by approving a plan of conversion and filing articles of conversion. A limited liability company organized under this chapter may be converted to a business entity organized under the laws of another jurisdiction if:

(a) The conversion is permitted by the laws of that jurisdiction;

(b) A plan of conversion is approved by the converting limited liability company;

(c) Articles of conversion are filed in this state;

(e) The limited liability company complies with any requirements imposed under the laws of the other jurisdiction.

(2) The plan of conversion shall set forth:

(a) The name and type of the business entity prior to conversion;

(b) The name and type of the business entity after conversion;

(e) Any additional information required in the organizational document of the converted business entity by the statutes governing that type of business entity.

(3) The plan of conversion may set forth other provisions relating to the conversion.

SECTION 17. ORS 63.481 is amended to read:

63.481. (1) [One or more limited liability companies may merge with one or more business entities, pursuant to this section, if each business entity that is a party to the merger approves a plan of merger and if the merger is permitted by the statutes governing each business entity. The business entity that survives may be a limited liability company or another business entity.] One or more business entities may merge into a limited liability company organized under the laws of this state if the merger is permitted by the statutes governing each 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 limited liability company organized under this chapter may be merged into a business entity organized under the laws of another jurisdiction if:

(a) The merger is permitted by the laws of that jurisdiction;

(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 limited liability company complies with any requirements imposed under the laws of the other jurisdiction.

(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;

(e) If any party is a business entity other than a limited liability company, 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 organization of a limited liability company, if that company is the surviving business entity; and

(b) Other provisions relating to the merger.

SECTION 18. ORS 67.342 is amended to read:

67.342. (1) A business entity other than a partnership may be converted to a partnership organized under this chapter, and a partnership may be converted to another business entity organized under the laws of this state, [pursuant to this section, by adopting a plan of conversion,] if conversion is permitted by the statutes governing the other business entity, by approving a plan of conversion and filing articles of conversion. A partnership organized under this chapter may be converted to a business entity organized under the laws of another jurisdiction if:

(a) The conversion is permitted by the laws of that jurisdiction;

(b) A plan of conversion is approved by the converting partnership;

(c) Articles of conversion are filed in this state;

(e) The partnership complies with any requirements imposed under the laws of the other jurisdiction.

(2) The plan of conversion shall set forth:

(a) The name and type of the business entity prior to conversion;

(b) The name and type of the business entity after conversion;

(e) If the business entity after conversion is not a partnership, any additional information required in the organizational document of the converted business entity by the statutes governing that type of business entity.

(3) The plan of conversion may set forth other provisions relating to the conversion.

SECTION 19. ORS 67.360 is amended to read:

67.360. (1) [One or more partnerships may merge with one or more business entities, pursuant to this section, if each business entity that is a party to the merger approves a plan of merger and if the merger is permitted by the statutes governing each business entity. The business entity that survives may be a partnership or another business entity.] One or more business entities may merge into a partnership organized under the laws of this state if the merger is permitted by the statutes governing each 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 partnership organized under this chapter may be merged into a business entity organized under the laws of another jurisdiction if:

(a) The merger is permitted by the laws of the other jurisdiction;

(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 partnership complies with all requirements imposed under the laws of the other jurisdiction.

(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;

(e) If any party is a business entity other than a partnership, 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 partnership agreement of a partnership and, if applicable, its registration as a limited liability partnership if the partnership is the surviving business entity; and

(b) Other provisions relating to the merger.

SECTION 20. ORS 70.505 is amended to read:

70.505. (1) A business entity that is not a limited partnership may convert to a limited partnership organized under this chapter, and a limited partnership may convert to another business entity organized under the laws of this state, [pursuant to this section, by adopting a plan of conversion,] if conversion is permitted by the statutes governing the other business entity, by approving a plan of conversion and filing articles of conversion. A limited partnership organized under this chapter may be converted to a business entity organized under the laws of another jurisdiction if:

(a) The conversion is permitted by the laws of that jurisdiction;

(b) A plan of conversion is approved by the converting limited partnership;

(c) Articles of conversion are filed in this state;

(e) The limited partnership complies with any requirements imposed under the laws of the other jurisdiction.

(2) A plan of conversion shall set forth:

(a) The name and type of business entity prior to conversion;

(b) The name and type of the business entity after conversion;

(e) Any additional information required in the organizational document of the converted business entity by the statutes governing that type of business entity.

(3) The plan of conversion may set forth other provisions relating to the conversion.

SECTION 21. ORS 70.525 is amended to read:

70.525. (1) [A limited partnership may merge with one or more business entities, pursuant to this section, if each business entity that is a party to the merger approves a plan of merger and if the merger is permitted by the statutes governing each business entity. The business entity that survives may be a limited partnership or another business entity.] One or more business entities may merge into a limited partnership organized under the laws of this state if the merger is permitted by the statutes governing each 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 limited partnership organized under this chapter may be merged into a business entity organized under the laws of another jurisdiction if:

(a) The merger is permitted by the laws of the other jurisdiction;

(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 limited partnership complies with all requirements imposed under the laws of the other jurisdiction.

(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;

(e) If any party is a business entity other than a limited partnership, 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 certificate of limited partnership, if a limited partnership is the surviving business entity; and

(b) Other provisions relating to the merger.

SECTION 22. ORS 60.211 is amended to read:

60.211. (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 [this section] 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 [the] 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.

SECTION 23. ORS 63.155 is amended to read:

63.155. (1) The only fiduciary duties a member owes to a member-managed limited liability company and its other members are the duty of loyalty and the duty of care set forth in subsections (2) and (3) of this section.

(2) A member’s duty of loyalty to a member-managed limited liability company and its other members includes the following:

(a) To account to the limited liability company and hold for it any property, profit or benefit derived by the member in the conduct and winding up of the limited liability company’s business or derived from a use by the member of limited liability company property, including the appropriation of a limited liability company opportunity;

(b) Except as provided in subsections (5) and (6) of this section, to refrain from dealing with the limited liability company in a manner adverse to the limited liability company and to refrain from representing a person with an interest adverse to the limited liability company, in the conduct or winding up of the limited liability company’s business; and

(c) To refrain from competing with the limited liability company in the conduct of the business of the limited liability company before the dissolution of the limited liability company.

(3) A member’s duty of care to a member-managed limited liability company and the other members in the conduct and winding up of the business of the limited liability company is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct or a knowing violation of law.

(4) A member shall discharge the duties to a member-managed limited liability company and the other members under this chapter or under any operating agreement of the limited liability company and exercise any rights consistent with the obligation of good faith and fair dealing.

(5) A member of a member-managed limited liability company does not violate a duty or obligation under this chapter or under any operating agreement of the limited liability company merely because the member’s conduct furthers the member’s own interest.

(6) A member of a member-managed limited liability company may lend money to or transact other business with the limited liability company, provided that any loan or transaction between the member and the limited liability company must be:

(a) Fair to the limited liability company;

(b) Authorized by an operating agreement; or

(c) Authorized or ratified by a majority of the disinterested members or by a number or percentage of members specified in the operating agreement after full disclosure of all material facts.

(7) Loans and other transactions between a member-managed limited liability company and a member are binding on the parties in the same manner as transactions between the limited liability company and persons who are not members, subject to other applicable law.

(8) This section also applies to a person who is not a member and who is winding up the limited liability company’s business.

(9) In a manager-managed limited liability company:

(a) A member who is not also a manager owes no duties to the limited liability company or the other members solely by reason of being a member;

(b) A manager is held to the same standards of conduct prescribed for members in subsections (2) to (8) of this section;

(c) A member who, pursuant to an operating agreement, exercises some or all of the rights of a manager in the management and conduct of the limited liability company’s business is held to the standards of conduct described in subsections (2) to (8) of this section to the extent that the member exercises the managerial authority vested in a manager by this chapter; and

(d) A manager is relieved of liability imposed by law for violation of the standards prescribed by this section to the extent, if any, of the managerial authority delegated to the members who are not also managers by an operating agreement.

[(10) An operating agreement may:]

[(a) Identify types or categories of activities that do not violate the duty of loyalty, if not unconscionable; and]

[(b) Specify the number or percentage of members, whether interested or disinterested, or disinterested managers that may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty.]

[(11) An operating agreement may not:]

[(a) Eliminate the duty of loyalty under subsection (2) of this section;]

[(b) Unreasonably reduce the duty of care under subsection (3) of this section; or]

[(c) Eliminate the obligation of good faith and fair dealing under subsection (4) of this section, but an operating agreement may determine the standards by which the performance of the obligation is to be measured, if the standards are not unconscionable.]

(10) The articles of organization or an operating agreement of a limited liability company may not:

(a) Eliminate completely the duty of loyalty under subsection (2) of this section, but the articles of organization or an operating agreement may:

(A) Identify specific types or categories of activities that do not violate the duty of loyalty, if not unconscionable; and

(B) Specify the number or percentage of members, whether interested or disinterested, or disinterested managers that may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty.

(b) Unreasonably reduce the duty of care under subsection (3) of this section.

(c) Eliminate completely the obligation of good faith and fair dealing under subsection (4) of this section, but the articles of organization or an operating agreement may determine the standards by which performance of the obligation of good faith and fair dealing is to be measured, if the standards are not unconscionable.

(11) For the purposes of subsection (10)(a) of this section, specific types or categories of activities that may be identified as not violating the duty of loyalty include, but are not limited to:

(a) Competing with the limited liability company in the conduct of the business of the limited liability company before the dissolution of the limited liability company; and

(b) Entering into or engaging in, for a member’s own account, an investment, business, transaction or activity that is similar to the investments, businesses, transactions or activities of the limited liability company without:

(A) First offering the limited liability company or the other members an opportunity to participate in the investment, business, transaction or activity; or

(B) Having any obligation to account to the limited liability company or the other members for the investment, business, transaction or activity or the profits from the investment, business, transaction or activity.

SECTION 24. ORS 60.111 is amended to read:

60.111. (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 [nonprofit] 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 [nonprofit] foreign nonprofit corporation authorized to transact business in this state whose business office is identical to the registered office.

SECTION 25. ORS 60.721 is amended to read:

60.721. 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;

(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.

SECTION 26. ORS 62.155 is amended to read:

62.155. (1) Each cooperative shall have and continuously maintain in this state:

(a) A registered office which may, but need not be, the same as its place of business.

(b) A registered agent[, which agent may be either] who shall be:

(A) An individual resident in this state whose business office is identical to such registered office; [, or]

(B) A domestic corporation, domestic limited liability company, domestic professional corporation or domestic nonprofit corporation having a business office identical to such 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 and having a business office identical to such registered office.

(2) A cooperative may change its registered office or registered agent in accordance with the procedure set forth in ORS 60.114.

(3) A person who has been designated by a cooperative as its registered agent may resign in accordance with the procedure set forth in ORS 60.117.

(4) A registered agent appointed by a cooperative is an agent of the cooperative upon whom any process, notice or demand required or permitted by law to be served upon the cooperative may be served.

(5) The provisions of ORS 60.121 are applicable to cooperatives.

SECTION 27. ORS 63.111 is amended to read:

63.111. (1) Each limited liability company 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 limited liability company, a domestic corporation, a domestic professional corporation or a [nonprofit] domestic nonprofit corporation whose business office is identical to the registered office; or

(c) A foreign limited liability company, foreign corporation, foreign professional corporation or [nonprofit] foreign nonprofit corporation authorized to transact business in this state whose business office is identical to the registered office.

SECTION 28. ORS 63.721 is amended to read:

63.721. Each foreign limited liability company 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 limited liability company, a domestic [business] corporation, a domestic professional corporation or a domestic nonprofit corporation whose business office is identical to the registered office; or

(c) A foreign limited liability company, a foreign [business] corporation, a foreign professional corporation or a foreign nonprofit corporation authorized to transact business in this state whose business office is identical to the registered office.

SECTION 29. ORS 65.111 is amended to read:

65.111. Each corporation shall continuously maintain in this state both:

(1) A registered agent, who shall be:

(a) An individual who resides in this state;

(b) A corporation, domestic business [or nonprofit] corporation, domestic limited liability company or domestic professional corporation with an office in this state; or

(c) A foreign corporation, foreign business [or nonprofit] corporation, foreign limited liability company or foreign professional corporation authorized to transact business in this state with an office in this state; and

(2) A registered office of the corporation, which shall be the residence or office address of the registered agent.

SECTION 30. ORS 65.721 is amended to read:

65.721. Each foreign corporation authorized to transact business in this state shall continuously maintain in this state both:

(1) A registered agent, who shall be:

(a) An individual who resides in this state;

(b) A corporation, domestic business [or nonprofit] corporation, domestic limited liability company or domestic professional corporation with an office in this state; or

(c) A foreign nonprofit corporation, foreign business [or nonprofit] corporation, foreign limited liability company or foreign professional corporation authorized to transact business in this state with an office in this state; and

(2) A registered office of the foreign corporation, which shall be the address, including street and number, of the residence or office of the registered agent.

SECTION 31. ORS 70.025 is amended to read:

70.025. (1) Each domestic limited partnership and each foreign limited partnership doing business in this state and all general partners of each domestic limited partnership or foreign limited partnership shall continuously maintain in this state a single registered agent who shall be amenable to service of process at the registered agent’s business office in this state. The registered agent [may be either] shall be:

(a) An individual resident of this state who has a business office in this state; [or]

(b) A domestic corporation, domestic limited liability company, domestic professional corporation or domestic nonprofit corporation that has a business office in this state; or

(c) A foreign corporation, foreign limited liability company, foreign professional corporation or foreign nonprofit corporation that is authorized to transact business in this state and has a business office in this state.

(2) A domestic or foreign limited partnership and the general partners thereof may change their registered agent upon submitting for filing to the Office of Secretary of State a statement described in this subsection. The statement shall be executed by any general partner. The filing of the statement shall immediately terminate the existing registered agent and establish the newly appointed registered agent as the registered agent of the domestic or foreign limited partnership and the general partners thereof. The statement shall include the following:

(a) The name of the domestic or foreign limited partnership and the name and address of each general partner thereof; and

(b) The name of the successor registered agent and the street address of that registered agent’s business office in this state.

SECTION 32. ORS 60.001 is amended to read:

60.001. As used in this chapter:

(1) “Anniversary” means that day each year exactly one or more years after:

(a) The date of filing by the Secretary of State of the articles of incorporation in the case of a domestic corporation.

(b) The date of filing by the Secretary of State of an application for authority to transact business in the case of a foreign corporation.

(2) “Articles of incorporation” include amended and restated articles of incorporation, articles of conversion and articles of merger.

(3) “Authorized shares” means the shares of all classes a domestic or foreign corporation is authorized to issue.

(4) “Conspicuous” means so written that a reasonable person against whom the writing is to operate should have noticed it. For example, printing in italics, boldface or contrasting color, typing in capitals or underlined is conspicuous.

(5) “Corporation” or “domestic corporation” means a corporation for profit, which is not a foreign corporation, incorporated under or subject to the provisions of this chapter.

(6) “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 its shareholders in respect of any of its shares. A distribution may be in the form of a declaration or payment of a dividend, a purchase, redemption or other acquisition of shares, a distribution of indebtedness, or otherwise.

(7) “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.

(8) “Domestic nonprofit corporation” means a corporation not for profit incorporated under ORS chapter 65.

(9) “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.

[(7)] (10) “Employee” includes an officer but not a director. A director may accept duties that make the director also an employee.

[(8)] (11) “Entity” includes a corporation, foreign corporation, nonprofit corporation, profit and nonprofit unincorporated association, business trust, estate, partnership, trust, two or more persons having a joint or common economic interest, any state, the United States and any foreign government.

[(9)] (12) “Foreign corporation” means a corporation for profit incorporated under a law other than the law of this state.

(13) “Foreign limited liability company” means an entity that is an unincorporated association organized under the laws of a state other than this state or under the laws of a foreign country and that is organized under a statute under which an association may be formed that affords to each of its members limited liability with respect to liabilities of the entity.

(14) “Foreign nonprofit corporation” means a corporation not for profit organized under the laws of a state other than this state.

(15) “Foreign professional corporation” means a professional corporation organized under the laws of a state other than this state.

[(10)] (16) “Governmental subdivision” includes an authority, county, district and municipality.

[(11)] (17) “Includes” denotes a partial definition.

[(12)] (18) “Individual” means a natural person.

[(13)] (19) “Means” denotes an exhaustive definition.

[(14)] (20) “Office,” when used to refer to the administrative unit directed by the Secretary of State, means the office of the Secretary of State.

[(15)] (21) “Person” includes individual and entity.

[(16)] (22) “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.

[(17)] (23) “Proceeding” includes civil, criminal, administrative and investigatory action.

[(18)(a)] (24)(a) “Proxy” means a written authorization signed or an electronic transmission authorized by a shareholder or the shareholder’s attorney in fact giving another person or persons power to vote with respect to the shares of the shareholder.

(b) As used in this subsection, “signed” means the placing of the shareholder’s name or other authorization on the proxy, whether by manual signature, typewriting, telegraphic or electronic transmission or otherwise, by the shareholder or the shareholder’s attorney in fact. A proxy may be transmitted by an oral telephonic communication if it is submitted with information from which it may be determined that the proxy was authorized by the shareholder or the shareholder’s attorney in fact.

[(19)] (25) “Record date” means the date established under this chapter on which a corporation determines the identity of its shareholders and their shareholdings for purposes of this chapter. The determinations shall be made as of the close of business on the record date unless another time for doing so is specified when the record date is fixed.

[(20)] (26) “Share” means the units into which the proprietary interest in a corporation are divided.

[(21)] (27) “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.

[(22)] (28) “State,” when referring to a part of the United States, includes a state, commonwealth, territory and insular possession of the United States and its agencies and governmental subdivisions.

[(23)] (29) “Subscriber” means a person who subscribes for shares in a corporation, whether before or after incorporation.

[(24)] (30) “United States” includes a district, authority, bureau, commission, department and any other agency of the United States.

[(25)] (31) “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.

SECTION 33. ORS 62.015 is amended to read:

62.015. As used in this chapter, unless the context requires otherwise:

(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 cooperative.

(b) The date of filing by the Secretary of State of an application for authority to transact business in the case of a foreign cooperative.

(2) “Articles” means articles of incorporation, articles of conversion and articles of merger.

(3) “Board” means board of directors.

(4) “Cooperative” means a cooperative corporation which is subject to the provisions of this chapter.

(5) “Corporation” means a corporation which is not a cooperative.

(6) “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.

(7) “Domestic nonprofit corporation” means a corporation not for profit incorporated under ORS chapter 65.

(8) “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.

[(6)] (9) “Foreign cooperative” means a cooperative corporation organized under laws other than the laws of this state.

(10) “Foreign corporation” means a corporation for profit incorporated under the laws of a state other than this state.

(11) “Foreign limited liability company” means an entity that is an unincorporated association organized under the laws of a state other than this state or under the laws of a foreign country and that is organized under a statute under which an association may be formed that affords to each of its members limited liability with respect to liabilities of the entity.

(12) “Foreign nonprofit corporation” means a corporation not for profit organized under the laws of a state other than this state.

(13) “Foreign professional corporation” means a professional corporation organized under the laws of a state other than this state.

[(7)] (14) “Member” means a person who has been qualified and accepted for membership in a cooperative.

[(8)] (15) “Membership stock” means any class of stock, continuous ownership of which is required for membership in a cooperative.

[(9)] (16) “Person” includes individuals, corporations, associations, firms, partnerships, joint stock companies, trusts, estates and foreign and domestic cooperative corporations.

[(10)] (17) “Shareholder” means a holder of shares of capital stock of a cooperative other than membership stock.

SECTION 34. ORS 63.001 is amended to read:

63.001. 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 organization in the case of a domestic limited liability company.

(b) The date of filing by the Secretary of State of an application for authority to transact business in the case of a foreign limited liability company.

(2) “Articles of organization” means the document described in ORS 63.047 for the purpose of forming a limited liability company, including articles of organization as they may be amended or restated, articles of conversion and articles of merger.

(3) “Bankruptcy” means:

(a) Assignment by a member for the benefit of creditors;

(b) Commencement of a voluntary bankruptcy case by a member;

(d) Filing by a member of a petition or answer seeking for the member any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any statute, law or rule;

(e) Filing by a member of an answer or other pleading admitting or failing to contest the material allegations of a petition filed against the member in any proceeding of this nature;

(f) Seeking, consenting to or acquiescing in the appointment of a trustee, receiver or liquidator of the member or of all or any substantial part of the member’s properties;

(g) Commencement of an involuntary bankruptcy case against a member that has not been dismissed on or before the 120th day after the commencement of the case;

(h) Appointment, without the member’s consent, of a trustee, receiver or liquidator either of the member or of all or any substantial part of the member’s properties that is not vacated or stayed on or before the 90th day after appointment; or

(i) Appointment described in paragraph (h) of this subsection that is not vacated on or before the 90th day after expiration of the stay under paragraph (h) of this subsection.

(4) “Contribution” means anything of value which a person contributes to the limited liability company as a prerequisite for or in connection with membership including cash, property or services rendered or a promissory note or other binding obligation to contribute cash or property or to perform services.

(5) “Corporation” or “domestic corporation” means a corporation for profit incorporated under ORS chapter 60.

(6) “Distribution” means a direct or indirect transfer of money or other property, except of a limited liability company’s own interests, or incurrence of indebtedness by a limited liability company to or for the benefit of its members in respect of any of its member’s interests. A distribution may be in the form of a declaration or payment of profits, a purchase, retirement or other acquisition of interests, a distribution of indebtedness, or otherwise.

(7) “Domestic nonprofit corporation” means a corporation not for profit incorporated under ORS chapter 65.

[(7)] (9) “Entity” includes a domestic or foreign limited liability company, corporation, professional corporation, foreign corporation, domestic or foreign nonprofit corporation, domestic or foreign cooperative corporation, profit or nonprofit unincorporated association, business trust, estate, domestic or foreign general or limited partnership, trust, two or more persons having a joint or common economic interest, any state, the United States or any foreign government.

[(8)] (10) “Foreign corporation” means a corporation for profit incorporated under a law other than the law of this state.

[(9)] (11) “Foreign limited liability company” means an entity that is an unincorporated association that is organized under the laws of a state other than of this state or under the laws of any foreign country and that is organized under a statute pursuant to which an association may be formed that affords to each of its members limited liability with respect to the liabilities of the entity.

[(10)] (12) “Foreign limited partnership” means a limited partnership formed under the laws of any jurisdiction other than this state and having as partners one or more general partners and one or more limited partners.

(13) “Foreign nonprofit corporation” means a corporation not for profit organized under the laws of a state other than this state.

(14) “Foreign professional corporation” means a professional corporation organized under the laws of a state other than this state.

[(11)] (15) “Incompetency” means the entry of a judgment by a court of competent jurisdiction adjudicating the member incompetent to manage the member’s person or estate.

[(12)] (16) “Individual” means a natural person.

[(13)] (17) “Limited liability company” or “domestic limited liability company” means an entity that is an unincorporated association having one or more members that is organized under this chapter.

[(14)] (18) “Limited partnership” or “domestic limited partnership” means a partnership formed by two or more persons under ORS chapter 70 and having one or more general partners and one or more limited partners.

[(15)] (19) “Manager” or “managers” means a person or persons, who need not be members, designated by the members of a manager-managed limited liability company to manage the limited liability company’s business and affairs.

[(16)] (20) “Manager-managed limited liability company” means a limited liability company that is designated as a manager-managed limited liability company in its articles of organization or whose articles of organization otherwise expressly provide that the limited liability company will be managed by a manager or managers.

[(17)] (21) “Member” or “members” means a person or persons with both an ownership interest in a limited liability company and all the rights and obligations of a member specified under this chapter. “Member” does not include an assignee of an ownership interest who has not also acquired the voting and other rights appurtenant to membership.

[(18)] (22) “Member-managed limited liability company” means a limited liability company other than a manager-managed limited liability company.

[(19)] (23) “Membership interest” or “interest” means a member’s collective rights in a limited liability company, including the member’s share of profits and losses of the limited liability company, the right to receive distributions of the limited liability company’s assets and any right to vote or participate in management.

[(20)] (24) “Office,” when used to refer to the administrative unit directed by the Secretary of State, means the office of the Secretary of State.

[(21)] (25) “Operating agreement” means any valid agreement, written or oral, of the member or members as to the affairs of a limited liability company and the conduct of its business.

[(22)] (26) “Organizer” means one of the signers of the initial articles of organization.

[(23)] (27) “Party” includes an individual who was, is or is threatened to be made a named defendant or respondent in a proceeding.

[(24)] (28) “Person” means an individual or entity.

[(25)] (29) “Proceeding” means any threatened, pending or completed action, suit or proceeding whether civil, criminal, administrative or investigatory and whether formal or informal.

[(26)] (30) “State,” when referring to a part of the United States, includes a state, commonwealth, territory or insular possession of the United States and its agencies and governmental subdivisions.

[(27)] (31) “United States” includes a district, authority, bureau, commission, department or any other agency of the United States.

SECTION 35. ORS 65.001 is amended to read:

65.001. As used in this chapter, unless otherwise specifically provided:

(1) “Anniversary” means that day each year exactly one or more years after the date of filing by the Office of the Secretary of State of the articles of incorporation in the case of a domestic corporation or the date of filing by the Office of the Secretary of State of an application for authority to transact business in the case of a foreign corporation. An event which would otherwise cause an anniversary to fall on February 29 shall be deemed to have occurred on February 28.

(2) “Approved by the members” or “approval by the members” means approved or ratified by the members entitled to vote on the issue through either:

(a) The affirmative vote of a majority of the votes of such members represented and voting at a duly held meeting at which a quorum is present or the affirmative vote of such greater proportion including the votes of any required proportion of the members of any class as the articles, bylaws or this chapter may provide for specified types of member action; or

(b) A written ballot or written consent in conformity with this chapter.

(3) “Articles of incorporation” or “articles” include amended and restated articles of incorporation and articles of merger, and corrections thereto.

(4) “Board” or “board of directors” means the individual or individuals vested with overall management of the affairs of the domestic or foreign corporation, irrespective of the name by which the individual or individuals are designated, except that no individual or group of individuals are the board of directors because of powers delegated to that individual or group pursuant to ORS 65.301.

(5) “Bylaws” means the code or codes of rules, other than the articles adopted pursuant to this chapter or the laws governing a foreign corporation for the regulation or management of the affairs of the domestic or foreign corporation, irrespective of the name or names by which such rules are designated.

(6) “Class” means a group of memberships which have the same rights with respect to voting, dissolution, redemption and transfer. For the purpose of this section, rights shall be considered the same if they are determined by a formula applied uniformly.

(7) “Contact address” means a mailing address at which a person affiliated with the organization will receive and transmit to the organization notices intended for the foreign or domestic corporation when it is either not practical to send such notices to the registered agent, or a duplicate notice is desirable. The contact address may be the principal place of business, if any, or the business or residence address of any person associated with the corporation or foreign corporation who has consented to serve, but shall not be the address of the registered agent.

(8) “Corporation” or “domestic corporation” means a nonprofit corporation [which] that is not a foreign corporation, [which] and that is incorporated under or subject to the provisions of this chapter.

(9) “Delegates” means those persons elected or appointed to vote in a representative assembly for the election of a director or directors or on other matters.

(10) “Deliver” includes mail.

(11) “Directors” means individuals designated in the articles or bylaws or elected by the incorporators to act as members of the board, and their successors.

(12) “Distribution” means the payment of a dividend or any part of the income or profit of a corporation to its members, directors or officers, and does not include payment of value for property received or services performed or payment of benefits in furtherance of the corporation’s purposes.

(13) “Domestic business corporation” means a for profit corporation incorporated under ORS chapter 60.

(14) “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.

(15) “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.

[(13)] (16) “Effective date of notice” has the meaning given that term in ORS 65.034.

[(14)] (17) “Employee” does not include an officer or director who is not employed by the corporation with compensation for services beyond those encompassed by board membership.

[(15)] (18) “Entity” includes a corporation, foreign corporation, business corporation and foreign business corporation, profit and nonprofit unincorporated association, corporation sole, business trust, estate, partnership, trust, two or more persons having a joint or common economic interest, any state, the United States and any foreign government.

[(16)] (19) “File,” “filed” or “filing” means reviewed, accepted and entered in the Office of the Secretary of State.

(20) “Foreign business corporation” means a for profit corporation incorporated under the laws of a state other than this state.

[(17)] (21) “Foreign corporation” means a corporation organized under a law other than the law of this state which would be a nonprofit corporation if formed under the laws of this state.

(22) “Foreign limited liability company” means an entity that is an unincorporated association organized under the laws of a state other than this state or under the laws of a foreign country and that is organized under a statute under which an association may be formed that affords to each of its members limited liability with respect to liabilities of the entity.

(23) “Foreign professional corporation” means a professional corporation organized under the laws of a state other than this state.

[(18)] (24) “Governmental subdivision” includes an authority, county, district and municipality.

[(19)] (25) “Includes” denotes a partial definition.

[(20)] (26) “Individual” means a natural person and includes the guardian of an incompetent individual.

[(21)] (27) “Means” denotes an exhaustive definition.

[(22)(a)] (28)(a) “Member” means any person or persons entitled, pursuant to a domestic or foreign corporation’s articles or bylaws, without regard to what a person is called in the articles or bylaws, to vote on more than one occasion for the election of a director or directors.

(b) A person is not a member by virtue of any of the following rights the person has:

(A) As a delegate;

(B) To designate or appoint a director or directors;

(D) As a holder of an evidence of indebtedness issued or to be issued by the corporation.

(c) Notwithstanding the provisions of paragraph (a) of this subsection, a person is not a member if the person’s membership rights have been eliminated as provided in ORS 65.164 or 65.167.

[(23)] (29) “Membership” refers to the rights and obligations a member or members, as defined in this chapter, have pursuant to this chapter.

[(24)] (30) “Mutual benefit corporation” means a domestic corporation which either is formed as a mutual benefit corporation pursuant to ORS 65.044 to 65.067, is designated a mutual benefit corporation by a statute or does not come within the definition of public benefit or religious corporation.

[(25)] (31) “Nonprofit corporation” means mutual benefit corporations, public benefit corporations and religious corporations.

[(26)] (32) “Notice” has the meaning given that term in ORS 65.034.

[(27)] (33) “Office” when used to refer to the administrative unit directed by the Secretary of State, means the Office of the Secretary of State.

[(28)] (34) “Person” includes any individual or entity.

[(29)] (35) “Principal office” means the place, in or out of this state, so designated in the most recent annual report filed pursuant to ORS 65.787 or if no annual report is on file, as designated in the articles of incorporation, or the application for authority to transact business in this state, which shall be the place where the principal executive offices of a domestic or foreign corporation are located, or if none, the contact address.

[(30)] (36) “Proceeding” includes civil, criminal, administrative and investigatory action.

[(31)] (37) “Public benefit corporation” means a domestic corporation which:

(a) Is formed as a public benefit corporation pursuant to ORS 65.044 to 65.067, is designated as a public benefit corporation by a statute, is recognized as tax exempt under section 501 (c) (3) of the Internal Revenue Code of 1986 or is otherwise organized for a public or charitable purpose;

(b) Is restricted so that on dissolution it must distribute its assets to an organization organized for a public or charitable purpose, a religious corporation, the United States, a state or a person which is recognized as exempt under section 501 (c) (3) of the Internal Revenue Code of 1986; and

[(32)] (38) “Record date” means the date established under ORS 65.131 to 65.177 or 65.201 to 65.254 on which a corporation determines the identity of its members and their membership rights for the purposes of this chapter. The determinations shall be made as of the time of close of transactions on the record date unless another time for doing so is specified at the time the record date is fixed.

[(33)] (39) “Religious corporation” means a domestic corporation which is formed as a religious corporation pursuant to ORS 65.044 to 65.067, is designated a religious corporation by a statute or is organized primarily or exclusively for religious purposes.

[(34)] (40) “Secretary,” when used in the context of a corporate official, means the corporate officer to whom the board of directors has delegated responsibility under ORS 65.371 for preparing the minutes of the directors’ and members’ meetings and for authenticating the records of the corporation.

[(35)] (41) “State” when referring to a part of the United States, includes a state, commonwealth, territory and insular possession of the United States and its agencies and governmental subdivisions.

[(36)] (42) “Uncompensated officer” means an individual who serves in an office without compensation for personal service. Payment solely for actual expenses in performing duties of the officer or a stipend which is paid only to compensate the average expenses incurred over the course of a year shall not be deemed to be compensation.

[(37)] (43) “United States” includes district, authority, bureau, commission, department and any other agency of the United States.

[(38)] (44) “Vote” includes authorization by written ballot and written consent, where permitted.

[(39)] (45) “Voting power” means the total number of votes entitled to be cast on the issue at the time the determination of voting power is made, excluding a vote which is contingent upon the happening of a condition or event which has not occurred at the time. Where a class is entitled to vote as a class for directors, the determination of voting power of the class shall be based on the percentage of the number of directors the class is entitled to elect out of the total number of authorized directors.

SECTION 36. ORS 70.005 is amended to read:

70.005. As used in this chapter:

(1) “Certificate of limited partnership” means the certificate referred to in ORS 70.075, and the certificate as amended, articles of conversion and articles of merger.

(2) “Contribution” means any cash, property, services rendered, or a promissory note or other binding obligation to contribute cash or property or to perform services, that a partner contributes to a limited partnership in the capacity as a partner.

(3) “Corporation” or “domestic corporation” means a corporation for profit incorporated under ORS chapter 60.

(4) “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.

(5) “Domestic nonprofit corporation” means a corporation not for profit incorporated under ORS chapter 65.

(6) “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.

[(3)] (7) “Event of withdrawal of a general partner” means an event that causes a person to cease to be a general partner as provided in ORS 70.180.

(8) “Foreign corporation” means a corporation for profit incorporated under the laws of a state other than this state.

(9) “Foreign limited liability company” means an entity that is an unincorporated association organized under the laws of a state other than this state or under the laws of a foreign country and that is organized under a statute under which an association may be formed that provides to each of its members limited liability with respect to liabilities of the entity.

[(4)] (10) “Foreign limited partnership” means a partnership formed under the laws of any jurisdiction other than this state and having as partners one or more general partners and one or more limited partners.

(11) “Foreign nonprofit corporation” means a corporation not for profit organized under the laws of a state other than this state.

(12) “Foreign professional corporation” means a professional corporation organized under the laws of a state other than this state.

[(5)] (13) “General partner” means a person who has been admitted to a limited partnership as a general partner in accordance with the partnership agreement and named in the certificate of limited partnership as a general partner.

[(6)] (14) “Limited partner” means a person who has been admitted to a limited partnership as a limited partner in accordance with the partnership agreement.

[(7)] (15) “Limited partnership” and “domestic limited partnership” mean a partnership formed by two or more persons under the laws of this state and having one or more general partners and one or more limited partners.

[(8)] (16) “Partner” means a limited or general partner.

[(9)] (17) “Partnership agreement” means any valid agreement, written or oral, of the partners as to the affairs of a limited partnership and the conduct of its business.

[(10)] (18) “Partnership interest” means a partner’s share of the profits and losses of a limited partnership and the right to receive distributions of partnership assets.

[(11)] (19) “Person” means an individual, partnership, limited partnership (domestic or foreign), trust, estate, association or corporation.

SECTION 37. ORS 70.610 is amended to read:

70.610. (1) Each domestic limited partnership and each foreign limited partnership registered to transact business in this state shall submit for filing an annual report to the Office of Secretary of State that includes:

(a) The name of the domestic or foreign limited partnership and the state or country under the laws of which it is formed;

(b) The street address of its registered office in this state and the name of its registered agent at that office;

(d) The category of the classification code as established by rule of the Secretary of State most closely designating the primary business activity of the domestic or foreign limited partnership;

(e) The location of the office in which the records described in ORS 70.050 are kept;

(f) A mailing address to which the Secretary of State may mail notices as required by this chapter;

(g) The federal employer identification number of the domestic or foreign limited partnership; and

(h) Additional identifying information that the Secretary of State may require by rule.

(2) The annual report shall be on forms prescribed and furnished by the Secretary of State. The information contained in the annual report shall be current as of 30 days before the anniversary of the domestic or foreign limited partnership.

(3) The annual report shall be signed by at least one general partner, or if the domestic or foreign limited partnership is in the hands of a receiver or trustee, it shall be signed on behalf of the partnership by such receiver or trustee.

(4) The Secretary of State shall mail the annual report form to the address shown for the limited partnership in the current records of the Office of Secretary of State. The failure of the limited partnership to receive the annual report form from the Secretary of State shall not relieve the limited partnership of its duty to deliver an annual report to the Office of the Secretary of State as required by this section.

(5) If the Secretary of State finds that the report conforms to the requirements of this chapter and all fees have been paid, the Secretary of State shall file the report.

[(6) If the Secretary of State finds that the report does not conform to the requirements of this chapter or that the correct fees have not been paid, the Secretary of State shall notify the partnership of its error. The partnership must correct the error within 45 days after the Secretary of State gives the notice.]

[(7) If the domestic or foreign limited partnership fails to return the annual report and pay the fees by its anniversary date or fails to return the corrected annual report or pay the correct fees within the 45-day period, the Secretary of State shall:]

[(a) Give the partnership notice by first class mail that a sufficient report has not been filed and that the partnership is inactive unless a sufficient report is filed within 45 days after the mailing of the final notice; and]

[(b) Note on the records of the Office of Secretary of State that the partnership is inactive.]

[(8)] (6) A limited partnership may deliver to the Office of Secretary of State for filing an amendment to the annual report if a change in the information set forth in the annual report occurs after the report is delivered to the Office of Secretary of State for filing and before the next anniversary. This subsection applies only to a change that is not required to be made by an amendment to the certificate of limited partnership. The amendment to the annual report shall set forth:

(a) The name of the limited partnership as shown on the records of the Office of Secretary of State; and

(b) The information as changed.

SECTION 38. ORS 70.435 is amended to read:

70.435. (1) If the Secretary of State determines that one or more grounds exist under ORS 70.430 for inactivating a certificate of limited partnership or the registration of a foreign limited partnership, [and] the Secretary of State shall give the limited partnership notice of that determination.

(2) If the limited partnership, within 45 days after the notice is given, does not correct each ground for inactivation or demonstrate to the satisfaction of the Secretary of State that each ground determined by the Secretary of State does not exist, the Secretary of State shall inactivate the certificate of limited partnership or the registration of a foreign limited partnership.

[(2)] (3) The administrative inactivation of a certificate of domestic limited partnership does not terminate the authority of its registered agent.

[(3)] (4) The administrative inactivation of the registration of a foreign limited partnership terminates the authority of the registered agent of the foreign limited partnership.

SECTION 39. ORS 56.080 is amended to read:

56.080. (1) Except as provided in subsections (2), [and] (3) and (4) of this section, the Secretary of State, within one year after a filing, at any time after a hearing held not less than 20 days after written notice to the company or individual who submitted the document to the office, may withdraw any certificate issued or document filed by the Secretary of State, except filings pursuant to ORS chapter 647, on any ground existing at the time of the filing for which the Secretary of State could have originally refused to issue the certificate or file the document. The written notice of such hearing shall state the reason for the proposed withdrawal.

(2) The Secretary of State, within one year after a filing, may withdraw from filing any document filed by the Secretary of State when the person who submitted the document advises the office that the document was submitted prematurely or by inadvertence or mistake. The person requesting the withdrawal shall accompany the request with a written statement reflecting the basis of the person’s authority to initiate the withdrawal.

(3) The Secretary of State may withdraw without notice or hearing a certificate that the Secretary of State has issued or a document the Secretary of State has filed when the fee was paid with a check that was returned to the office for lack of sufficient funds. Such withdrawal shall be retroactive to the date of filing.

(4) The Secretary of State shall withdraw a certificate the Secretary of State has issued or a document the Secretary of State has filed if the Secretary of State receives a final written order from the Director of the Department of Consumer and Business Services that establishes that the person named in the certificate or document has violated ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act.

[(4)] (5) Any decision under this section may be reviewed in accordance with the provisions of ORS 183.310 to 183.550.

[(5)] (6) A withdrawal from filing of a document under this section is retroactive to the date of the filing but shall not relieve a person of any liability the person may have incurred while the document was filed with the office. The Secretary of State is not required to refund any fees paid in conjunction with the document withdrawn.

[(6)] (7) At any time prior to a delayed effective date specified in a document, upon written request of the person or persons who originally filed the document with the Secretary of State, the document shall be withdrawn. Upon such withdrawal of a document, the document shall have no further effect and shall be treated as if it had not been filed. The person requesting the withdrawal shall accompany the request with a written statement reflecting the basis of the person’s authority to initiate the withdrawal.

SECTION 40. ORS 56.080, as amended by section 6, chapter 652, Oregon Laws 1999, is amended to read:

56.080. (1) Except as provided in subsections (2), [and] (3) and (4) of this section, the Secretary of State, within one year after a filing and not less than 20 days after written notice to the company or individual who submitted the document to the office, may withdraw any certificate issued or document filed by the Secretary of State, except filings pursuant to ORS chapter 647, on any ground existing at the time of the filing for which the Secretary of State could have originally refused to issue the certificate or file the document. The written notice shall state the reason for the proposed withdrawal.

[(4)] (5) Any decision under this section may be reviewed in accordance with the provisions of ORS 183.310 to 183.550.

SECTION 41. Section 42 of this 2001 Act is added to and made a part of ORS chapter 56.

SECTION 42. (1) If a person seeks to make a business registry filing of a name with the Secretary of State under ORS chapter 58, 60, 62, 63, 65, 67, 68, 70, 554 or 648 or ORS 128.560 to 128.600 that contains the word or words “banc,” “bancorp,” “bank,” “banker,” “banking,” “savings,” “safe deposit,” “trust,” “trustee,” “building and loan” or their equivalents in a language other than English, or a similar word or words in English or an equivalent in a language other than English, implying a business primarily engaged in the lending of money, underwriting or sale of financial products, acting as a depository institution, acting as a financial planner, financial adviser or acting as a loan broker, the Secretary of State may not accept the name for filing without first receiving specific written approval from the Director of the Department of Consumer and Business Services under the provisions of section 45 of this 2001 Act.

(2) The provisions of subsection (1) of this section do not apply if the Secretary of State is satisfied that the name at issue is in a context clearly not purporting to refer to a banking or other financial activity or not likely to mislead the public about the nature of the business or lead to a pattern and practice of abuse that might cause harm to the interests of the public or the State of Oregon as determined by the Secretary of State.

SECTION 43. Sections 44, 45, 46 and 47 of this 2001 Act are added to and made a part of ORS chapter 705.

SECTION 44. (1) For purposes of this section, “company” means a corporation, nonprofit corporation, cooperative, limited liability company, partnership, limited liability partnership, limited partnership, business trust, association or other business entity.

(2) A company organized under the laws of this state for the purposes of conducting a banking business as defined in ORS 706.005 (6) either within or outside this state shall be organized under ORS chapter 707.

(3) A company organized under the laws of this state to transact savings and loan business as defined in ORS 722.004 (25) either within or outside this state shall be organized under ORS chapter 722.

SECTION 45. (1) A person may submit a written request for a certificate from the Director of the Department of Consumer and Business Services for purposes of complying with the provisions of section 42 of this 2001 Act. The request shall provide such information as the director may require by rule or order.

(2) Upon receiving a request for a certificate under subsection (1) of this section, the director shall within 10 business days determine whether the requested name and intended activity are in compliance with the provisions of the Bank Act and ORS chapters 59, 645, 705, 717, 722, 725 and 726.

(3)(a) If the director determines that use of the requested name or intended activity is in compliance with the Bank Act and ORS chapters 59, 645, 705, 717, 722, 725 and 726, the director shall issue a written certificate.

(b) If the director determines that use of the requested name or intended activity is not in compliance with the Bank Act and ORS chapters 59, 645, 705, 717, 722, 725 and 726, the director shall promptly notify the requester in writing, who may:

(A) Amend the name or activity and submit a written request to the director for reconsideration; or

(B) Request that the director conduct an administrative hearing. The hearing shall be conducted as a contested case hearing pursuant to ORS 183.310 to 183.550.

SECTION 46. (1) Whenever the Director of the Department of Consumer and Business Services has reason to believe that a person is violating any provision of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act, the director:

(a) Shall have access to the premises where that person is suspected of transacting banking business in violation of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act or where that person may have books, accounts and records; and

(b) Shall have the power to examine, copy or take possession of the books, accounts and records of that person in order to ascertain whether or not that person has violated or is violating any provision of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act.

(2) If a person refuses to grant access to the premises or refuses to comply with the provisions of subsection (1) of this section, the director may apply for an order from a court having jurisdiction over the matter requiring compliance with the provisions of subsection (1) of this section.

(3) When the director believes, from evidence satisfactory to the director, that any person is violating the provisions of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act, the director may:

(a) Issue an order finding the person in violation, directing the person to cease and desist from the violation and assessing a penalty equal to the costs of investigation plus $1,000, but not exceeding $5,000; and

(b) Publish notice of any order issued by the director pursuant to paragraph (a) of this subsection.

(4) An order under this section remains in effect until it is withdrawn by the director or by a court of competent jurisdiction.

SECTION 47. (1) Whenever it appears to the Director of the Department of Consumer and Business Services that a person has engaged, is engaging or is about to engage in an act or practice constituting a violation of any of the provisions of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act or any rule or order of the director, the director may bring suit in the name of or on behalf of the State of Oregon in the circuit court of any county of this state to enjoin the acts or practices and to enforce compliance with the provisions of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act or such rule or order. Upon a proper showing, the court shall grant a permanent or temporary injunction, restraining order or writ of mandamus. The court may fine the person against whom the order is entered not more than $20,000 for each violation, which shall be entered as a judgment and paid to the General Fund of the State Treasury. Each violation is a separate offense. In the case of a continuing violation, each day’s continuance is a separate violation, but the maximum penalty for any continuing violation shall not exceed $100,000. If the court finds that the defendant has violated any provision of ORS 707.005, 707.010 or 722.012 or section 44 of this 2001 Act or any rule or order, the court may appoint a receiver, who may be the director, for the defendant or the defendant’s assets. The court may not require the director to post a bond. The court may award reasonable attorney fees to the director if the director prevails in an action under this section. The court may award reasonable attorney fees to a defendant who prevails in an action under this section if the court determines that the director had no objectively reasonable basis for asserting the claim or no reasonable basis for appealing an adverse decision of the trial court.

(2) The director may include either of the following in any action authorized by subsection (1) of this section:

(a) A claim for restitution or damages on behalf of the persons injured by the act or practice constituting the subject matter of the action. The court shall have jurisdiction to award appropriate relief to such persons, if the court finds that enforcement of the rights of such persons by private civil action, whether by class action or otherwise, would be so burdensome or expensive as to be impractical.

(b) A claim for disgorgement of illegal gains or profits derived. Any recovery under this paragraph shall be turned over to the General Fund of the State Treasury unless the court requires other disposition.

SECTION 48. (1) On and after October 23, 1999, the following apply to all limited liability companies:

(a) The amendments to ORS 63.001, 63.034, 63.047, 63.130, 63.140, 63.160, 63.165, 63.229, 63.235, 63.437, 63.441, 63.629, 63.707, 63.771, 63.784 and 63.787 by sections 1 to 5, 9 to 18 and 22, chapter 86, Oregon Laws 1999; and

(b) The repeal of ORS 63.135, 63.145 and 63.150 by section 23, chapter 86, Oregon Laws 1999.

(2) Before January 1, 2005, ORS 63.155, as amended by section 8, chapter 86, Oregon Laws 1999, and section 23 of this 2001 Act, governs only:

(a) Limited liability companies created on or after October 23, 1999; and

(b) Limited liability companies created before October 23, 1999, that elect, in the manner provided in the limited liability company’s operating agreement or by law for amending the operating agreement, to be governed by ORS 63.155, as amended by section 8, chapter 86, Oregon Laws 1999, and section 23 of this 2001 Act.

(3) On and after January 1, 2005, ORS 63.155, as amended by section 8, chapter 86, Oregon Laws 1999, and section 23 of this 2001 Act, governs all limited liability companies.

(4) The amendments to ORS 63.155 by section 23 of this 2001 Act are intended to clarify the meaning and application of ORS 63.155, as amended by section 8, chapter 86, Oregon Laws 1999, and shall be effective as if enacted as part of section 8, chapter 86, Oregon Laws 1999.

SECTION 49. Section 50 of this 2001 Act is added to and made a part of ORS chapter 63.

SECTION 50. (1) All or part of this chapter may be amended or repealed at any time and all domestic and foreign limited liability companies subject to this chapter shall be governed by the amendment or repeal.

(2) The amendment or repeal of a statute in this chapter does not affect:

(a) The operation of the statute or any action taken under the statute before its amendment or repeal.

(b) Any ratification, right, remedy, privilege, obligation or liability acquired, accrued or incurred under the statute before its amendment or repeal.

(c) Any violation of the statute, or any penalty, forfeiture or punishment incurred because of the violation, before its amendment or repeal.

(d) Any proceeding, reorganization or dissolution commenced under the statute before its amendment or repeal. The proceeding, reorganization or dissolution may be completed in accordance with the statute as if it had not been amended or repealed.

SECTION 51. ORS 63.047 is amended to read:

63.047. (1) The articles of organization shall set forth:

(a) The name of the limited liability company which satisfies the requirements of ORS 63.094;

(b) The address, including street and number, and mailing address, if different, of the limited liability company’s initial registered office and the name of its initial registered agent at that office;

(c) A mailing address to which notices, as required by this chapter, may be mailed until an address has been designated by the limited liability company in its annual report;

(d) [Whether the limited liability company is to be member-managed or manager-managed, or shall specify whether the limited liability company is to be managed by a manager or managers] If the limited liability company is to be manager-managed, a statement that the limited liability company will be manager-managed or a statement that the limited liability company is to be managed by a manager or managers;

(e) The name and address of each organizer;

(f) The latest date on which the limited liability company is to dissolve or a statement that its existence is perpetual; and

(g) If a limited liability company is to render professional service or services, as defined in ORS 58.015, the professional service or services to be rendered through the limited liability company.

(2) The articles of organization may set forth any other provisions, not inconsistent with law, for the regulation of the internal affairs of the limited liability company, including any provision that is required or permitted to be included in any operating agreement of the limited liability company under this chapter.

(3) The articles of organization need not set forth any of the powers enumerated in this chapter.

SECTION 52. The amendments to ORS 63.047 by section 51 of this 2001 Act apply to articles of organization or amendments to articles of organization filed on or after the effective date of this 2001 Act.

SECTION 53. ORS 65.637 is amended to read:

65.637. (1) A dissolved corporation continues its corporate existence but may not carry on any activities except those appropriate to wind up and liquidate its affairs, including:

(a) Preserving and protecting its assets and minimizing its liabilities;

(b) Discharging or making provision for discharging its liabilities and obligations;

(d) Returning, transferring or conveying assets held by the corporation upon a condition requiring return, transfer or conveyance, which condition occurs by reason of the dissolution, in accordance with such condition;

(e) Transferring, subject to any contractual or legal requirements, its assets as provided in or authorized by its articles of incorporation or bylaws;

(f) If the corporation is a public benefit or religious corporation, and no provision has been made in its articles or bylaws for distribution of assets on dissolution, transferring, subject to any contractual or legal requirement, its assets to one or more persons described in ORS 65.001 [(31)(b)] (37)(b);

(g) If the corporation is a mutual benefit corporation and no provision has been made in its articles or bylaws for distribution of assets on dissolution, transferring, subject to any contractual or legal requirements, its assets to its members or, if it has no members, to those persons whom the corporation holds itself out as benefiting or serving; and

(h) Doing every other act necessary to liquidate its assets and wind up its affairs.

(2) Dissolution of a corporation does not:

(a) Transfer title to the corporation’s property;

(b) Subject its directors or officers to standards of conduct different from those prescribed in ORS 65.301 to 65.414;

(c) Change quorum or voting requirements for its board or members, change provisions for selection, resignation or removal of its directors or officers, or both, or change provisions for amending its bylaws;

(d) Prevent commencement of a proceeding by or against the corporation in its corporate name;

(e) Abate or suspend a proceeding pending by or against the corporation on the effective date of dissolution; or

(f) Terminate the authority of the registered agent of the corporation.

SECTION 54. ORS 271.330 is amended to read:

271.330. (1) Any political subdivision is granted express power to relinquish the title to any of its property not needed for public use to any governmental body, providing such property shall be used for not less than 20 years for a public purpose by the governmental body in the State of Oregon. These transfers for public purposes may include transfers without consideration of property held by counties as a result of tax foreclosures.

(2)(a) Any political subdivision is granted express power to relinquish the title to any of its property to a qualifying nonprofit corporation or a municipal corporation for the purpose of providing any of the following:

(A) Low income housing;

(B) Social services; or

(b) As used in this subsection:

(A) “Qualifying nonprofit corporation” means a corporation that is a public benefit corporation under ORS 65.001 [(31)] (37) and that has obtained a ruling from the federal Internal Revenue Service providing that the corporation is exempt from federal income taxes under section 501(c)(3) of the Internal Revenue Code.

(B) “Social services” and “child care services” include but are not limited to education, training, counseling, health and mental health services and the provision of facilities and administrative services to support social services and child care services.

(3) Any political subdivision is granted express power to convey real property to a nonprofit or municipal corporation to be used by the nonprofit or municipal corporation for the creation of open space, parks or natural areas for perpetual public use. The instrument conveying the real property shall include a restriction on the use of the property that limits the uses of the property to those uses described in this subsection. The instrument conveying the property shall also contain a provision for the reversion of the property to the political subdivision if the property is not used in conformance with the restriction. Real property conveyed under this subsection may include real property held by a political subdivision as a result of tax foreclosures.

(4) Transfers under this section may include transfers without consideration of property held by counties as a result of tax foreclosures.

(5) Before any county court or board of county commissioners may transfer, under subsection (1) of this section, any tax foreclosed lands in which the state or a political subdivision has represented delinquent and uncollected taxes, liens or assessments, it shall advertise in a newspaper of general circulation in the county for two successive weeks its intention to so transfer the property. The notice shall state when the county court will hear objections to the transfer and must specifically describe the property intended to be transferred. After the hearing set in the notice is held and objections are heard, it may, in its sound discretion, proceed with the transfer. Except in the case of a transfer for low income housing, real property shall be conveyed by deed, subject to a reversionary interest retained by the granting political subdivision in the event that the property is used for a purpose that is inconsistent with the grant. The granting political subdivision may waive the subdivision’s right to a reversionary interest at the time the property is conveyed. After the transfer the interests of the state or any political subdivision in the land on account of uncollected taxes, liens or assessments are extinguished, and the county is relieved of the necessity to account for uncollected taxes, liens or assessments.

SECTION 55. ORS 307.518 is amended to read:

307.518. (1) Property or a portion of property that meets all of the following criteria shall be exempt from taxation as provided under ORS 307.519 to 307.523:

(a) If unoccupied, the property:

(A) Is offered for rental solely as a residence for low income persons; or

(B) Is held for the purpose of developing low income rental housing.

(b) If occupied, the property is occupied solely as a residence for low income persons.

(c) An exemption for the property has been approved as provided under ORS 307.523, pursuant to an application filed before January 1, 2010.

(d) The property is owned or being purchased by a nonprofit corporation organized in a manner that meets the criteria for a public benefit corporation, as described under ORS 65.001 [(31)] (37) or for a religious corporation, as described under ORS 65.001 [(33)] (39).

(e) The property is owned or being purchased by a nonprofit corporation that expends no more than 10 percent of its annual income from residential rentals for purposes other than the acquisition, maintenance or repair of residential rental property for low income persons or for the provision of on-site child care services for the residents of the rental property.

(2) For the purposes of this section, a nonprofit corporation that has only a leasehold interest in property is considered to be a purchaser of that property if:

(a) The nonprofit corporation is obligated under the terms of the lease to pay the ad valorem taxes on the real and personal property used in the rental activity on that property; or

(b) The rent payable has been established to reflect the savings resulting from the exemption from taxation.

(3) A partnership shall be considered a nonprofit corporation for purposes of this section if:

(a) A nonprofit corporation is a general partner of the partnership; and

(b) The nonprofit corporation is responsible for the day-to-day operation of the property that is the subject of the exemption under ORS 307.519 to 307.523.

SECTION 56. ORS 554.082 is amended to read:

554.082. (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 or [nonprofit] domestic nonprofit corporation whose business office is identical to the registered office; or

(c) A foreign corporation or [nonprofit] foreign nonprofit corporation authorized to transact business in this state whose business office is identical to the registered office.

SECTION 57. ORS 750.635 is amended to read:

750.635. (1) Each organization 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 or [nonprofit] domestic nonprofit corporation whose business office is identical to the registered office; or

(c) A foreign corporation or [nonprofit] foreign nonprofit corporation authorized to transact business in this state whose business office is identical to the registered office.

(3) The Director of the Department of Consumer and Business Services shall be an agent of an organization upon whom process may be served whenever the organization fails to appoint or maintain a registered agent in this state or whenever the registered agent of the organization cannot with reasonable diligence be found at the registered office.

SECTION 58. ORS 60.661 is amended to read:

60.661. 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.

SECTION 59. Section 60 of this 2001 Act is added to and made a part of ORS chapter 60.

SECTION 60. (1) In a proceeding by a shareholder in a corporation that does not have shares that are listed on a national securities exchange or that are regularly traded in a market maintained by one or more members of a national or affiliated securities association, the circuit court may order one or more of the remedies listed in subsection (2) of this section if it is established that:

(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;

(d) The corporate assets are being misapplied or wasted.

(2) The remedies that the court may order in a proceeding under subsection (1) of this section include but are not limited to the following:

(a) The performance, prohibition, alteration or setting aside of any action of the corporation or of its shareholders, directors or officers or any other party to the proceeding;

(b) The cancellation or alteration of any provision in the corporation’s articles of incorporation or bylaws;

(c) The removal from office of any director or officer;

(d) The appointment of any individual as a director or officer;

(e) An accounting with respect to any matter in dispute;

(f) The appointment of a custodian to manage the business and affairs of the corporation, to serve for the term and under the conditions prescribed by the court;

(g) The appointment of a provisional director to serve for the term and under the conditions prescribed by the court;

(h) The submission of the dispute to mediation or another form of nonbinding alternative dispute resolution;

(i) The issuance of distributions;

(j) The award of damages to any aggrieved party;

(k) The purchase by the corporation or one or more shareholders of all of the shares of one or more other shareholders for their fair value and on the terms determined under subsection (5) of this section;

(L) The retention of jurisdiction of the case by the court for the protection of the shareholder who filed the proceeding; or

(m) The dissolution of the corporation if the court determines that no remedy specified in paragraphs (a) to (L) of this subsection or other alternative remedy is sufficient to resolve the matters in dispute. In determining whether to dissolve the corporation, the court shall consider among other relevant evidence the financial condition of the corporation but may not refuse to dissolve the corporation solely because it has accumulated earnings or current operating profits.

(3) The remedies set forth in subsection (2) of this section shall not be exclusive of other legal and equitable remedies that the court may impose. Except as provided in this subsection, the shareholders of a corporation may, pursuant to an agreement described in ORS 60.265, agree to limit or eliminate any of the remedies set forth in subsection (2) of this section. The remedies set forth in subsection (2)(e), (j) and (m) of this section may not be eliminated.

(4) In determining the appropriate remedies to order under subsection (2) of this section, the court may take into consideration the reasonable expectations of the corporation’s shareholders as they existed at the time the corporation was formed and developed during the course of the shareholders’ relationship with the corporation and with each other. The court shall endeavor to minimize the harm to the business of the corporation.

(5)(a) If the court orders a share purchase, the court shall:

(A) Determine the fair value of the shares, with or without the assistance of appraisers, taking into account any impact on the value of the shares resulting from the actions giving rise to a proceeding under subsection (1) of this section;

(B) Consider any financial or legal constraints on the ability of the corporation or the purchasing shareholder to purchase the shares;

(C) Specify the terms of the purchase, including, if appropriate, terms for installment payments, interest at the rate and from the date determined by the court to be equitable, subordination of the purchase obligation to the rights of the corporation’s other creditors, security for a deferred purchase price and a covenant not to compete or other restriction on the seller;

(D) Require the seller to deliver all of the seller’s shares to the purchaser upon receipt of the purchase price or the first installment of the purchase price; and

(E) Retain jurisdiction to enforce the purchase order by, among other remedies, ordering the corporation to be dissolved if the purchase is not completed in accordance with the terms of the purchase order.

(b) The share purchase ordered under this subsection shall be consummated within 20 days after the date the order becomes final unless before that time the corporation files with the court a notice of its intention to dissolve and articles of dissolution are properly filed with the Secretary of State within 50 days after filing the notice with the court.

(c) After the purchase order is entered and before the purchase price is fully paid, any party may petition the court to modify the terms of the purchase, and the court may do so if the court finds that the modifications are equitable.

(d) Unless the purchase order is modified by the court, the selling shareholder shall have no further rights as a shareholder from the date the seller delivers all of the shareholder’s shares to the purchaser or such other date specified by the court.

(e) If the court orders shares to be purchased by one or more other shareholders, in allocating the shares to be purchased by the other shareholders, unless equity requires otherwise, the court shall attempt to preserve the existing distribution of voting rights and other designations, preferences, qualifications, limitations, restrictions and special or relative rights among the holders of the class or classes of shares and may direct that holders of a specific class or classes not participate in the purchase.

(6) At any time within 90 days after the filing of a proceeding under subsection (1) of this section, or at such time determined by the court to be equitable, the corporation or one or more shareholders may elect to purchase all of the shares owned by the shareholder who filed the proceeding for their fair value. An election to purchase under this subsection shall state in writing the amount that the electing party will pay for the shares. The following apply:

(a) The election to purchase shall be irrevocable unless the court determines that it is equitable to set aside or modify the election.

(b) If the election to purchase is filed by one or more shareholders, the corporation shall, within 10 days thereafter, give written notice to all shareholders. The notice shall state the name of the shareholder who filed the proceeding under subsection (1) of this section and the number of shares owned by that shareholder, the name of each electing shareholder and the number of shares owned by that electing shareholder and the amount that each electing shareholder will pay for the shares. The notice also must advise the recipients of their right to join in the election to purchase shares. Shareholders who wish to participate must file notice of their intention to join in the election to purchase not later than 30 days after the date of the notice to them or at such time as the court in its discretion may allow. All shareholders who have filed an election or notice of their intention to participate in the election to purchase thereby become parties to the proceeding under subsection (1) of this section and shall participate in the purchase in proportion to their ownership of shares as of the date the first election was filed, unless the shareholders otherwise agree or the court otherwise directs.

(c) The court in its discretion may allow the corporation and shareholders to file an election to purchase the shares of the shareholder who filed the proceeding under subsection (1) of this section at a price higher than the amount previously offered. If the court does so, it shall allow other shareholders an opportunity to join in the election to purchase at the higher price in accordance with their proportionate ownership interest.

(d) After an election to purchase has been filed by the corporation or one or more shareholders, the proceeding filed under subsection (1) of this section may not be discontinued or settled, nor may the shareholder who filed the proceeding sell or otherwise dispose of the shareholder’s shares, unless the court determines that it would be equitable to the corporation and the shareholders, other than the petitioner, to permit the discontinuance, settlement, sale or other disposition. In considering whether equity exists to approve any settlement, the court may take into consideration the reasonable expectations of the shareholders as referred to in subsection (4) of this section, including any existing agreement among the shareholders.

(e) If, within 30 days of the filing of the latest election to purchase allowed by the court, the parties reach agreement as to the fair value and terms of purchase of the shares of the shareholder who filed the proceeding under subsection (1) of this section, the court shall enter an order directing the purchase of shares upon the terms and conditions agreed to by the parties.

(f) If the parties are unable to reach an agreement as described in paragraph (e) of this subsection, the court, upon application of any party, shall stay the proceeding under subsection (1) of this section and shall, under subsection (5) of this section, determine the fair value and terms of purchase of the shares of the shareholder who filed the proceeding as of the day before the date on which the proceeding was filed or as of such other date as the court deems appropriate under the circumstances.

(7) In any proceeding under subsection (1) of this section, the court shall allow reasonable compensation to the custodian, provisional director, appraiser or other such person appointed by the court for services rendered and reimbursement or direct payment of reasonable costs and expenses. Amounts described in this subsection shall be paid by the corporation.

SECTION 61. ORS 60.664 is amended to read:

60.664. (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 section 60 of this 2001 Act 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.

SECTION 62. ORS 60.667 is amended to read:

60.667. (1) A court in a judicial proceeding brought to dissolve a corporation, or in a judicial proceeding for shareholder remedies described in section 60 of this 2001 Act, 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.

SECTION 63. ORS 60.671 is amended to read:

60.671. (1) If after a hearing the court determines that one or more grounds for judicial dissolution described in ORS 60.661 or section 60 (2)(m) of this 2001 Act exist, it may enter a decree dissolving the corporation and specifying the effective date of the dissolution. The clerk of the court shall deliver a certified copy of the decree to the office for filing. The Secretary of State shall file the certified copy of the decree.

(2) After entering the decree 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.

SECTION 64. Section 60 of this 2001 Act and the amendments to ORS 60.661, 60.664, 60.667 and 60.671 by sections 58, 61, 62 and 63 of this 2001 Act apply to proceedings commenced in circuit court on or after the effective date of this 2001 Act.

Approved by the Governor June 5, 2001

Filed in the office of Secretary of State June 5, 2001

Effective date January 1, 2002

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