1.1                          A bill for an act 
  1.2             relating to business organizations; modifying 
  1.3             provisions relating to the standard of conduct for 
  1.4             directors, officers, governors, and managers of 
  1.5             corporations and limited liability companies; amending 
  1.6             Minnesota Statutes 2002, sections 302A.251, 
  1.7             subdivisions 1, 5; 302A.361; 322B.663, subdivisions 1, 
  1.8             5; 322B.69. 
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  Minnesota Statutes 2002, section 302A.251, 
  1.11  subdivision 1, is amended to read: 
  1.12     Subdivision 1.  [STANDARD; LIABILITY.] A director shall 
  1.13  discharge the duties of the position of director: 
  1.14     (1) in good faith,; 
  1.15     (2) in a manner the director reasonably believes to be in 
  1.16  the best interests of the corporation, consistent with the 
  1.17  considerations in subdivision 5; and 
  1.18     (3) with the care an ordinarily prudent person in a like 
  1.19  position would exercise under similar circumstances.  
  1.20     A person who so performs those duties is not liable to the 
  1.21  corporation or its shareholders by reason of being or having 
  1.22  been a director of the corporation.  Nothing in this section 
  1.23  creates liability to a person other than the corporation or a 
  1.24  shareholder.  
  1.25     Sec. 2.  Minnesota Statutes 2002, section 302A.251, 
  1.26  subdivision 5, is amended to read: 
  1.27     Subd. 5.  [CONSIDERATIONS.] In discharging the duties of 
  2.1   the position of director, a director may must, in considering 
  2.2   determining the best interests of the corporation, consider: 
  2.3      (1) the interests of the corporation's shareholders, 
  2.4   employees, customers, suppliers, and creditors, and other 
  2.5   persons affected by the activities of the corporation; 
  2.6      (2) the economy of communities in which an office or 
  2.7   facility of the corporation is located, the state, and nation,; 
  2.8      (3) community and societal considerations, including the 
  2.9   effect of the activities of the corporation on environmental 
  2.10  quality, public health, or safety; and 
  2.11     (4) the long-term as well as short-term interests of the 
  2.12  corporation and, its shareholders, and other persons affected by 
  2.13  the activities of the corporation, including the possibility 
  2.14  that these interests may be best served by the continued 
  2.15  independence of the corporation. 
  2.16     Sec. 3.  Minnesota Statutes 2002, section 302A.361, is 
  2.17  amended to read: 
  2.18     302A.361 [STANDARD OF CONDUCT.] 
  2.19     An officer shall discharge the duties of an office in good 
  2.20  faith, in a manner the officer reasonably believes to be in the 
  2.21  best interests of the corporation, and with the care an 
  2.22  ordinarily prudent person in a like position would exercise 
  2.23  under similar circumstances.  A person exercising the principal 
  2.24  functions of an office or to whom some or all of the duties and 
  2.25  powers of an office are delegated pursuant to section 302A.351 
  2.26  is deemed an officer for purposes of this section and sections 
  2.27  302A.467 and 302A.521.  In determining the best interests of the 
  2.28  corporation, an officer must consider the factors in section 
  2.29  302A.251, subdivision 5.  Nothing in this section creates 
  2.30  liability to a person other than the corporation or a 
  2.31  shareholder. 
  2.32     Sec. 4.  Minnesota Statutes 2002, section 322B.663, 
  2.33  subdivision 1, is amended to read: 
  2.34     Subdivision 1.  [STANDARD AND LIABILITY.] A governor shall 
  2.35  discharge the duties of the position of governor: 
  2.36     (1) in good faith,; 
  3.1      (2) in a manner the governor reasonably believes to be in 
  3.2   the best interests of the limited liability company, consistent 
  3.3   with the considerations in subdivision 5; and 
  3.4      (3) with the care an ordinarily prudent person in a like 
  3.5   position would exercise under similar circumstances.  
  3.6      A person who so performs those duties is not liable to the 
  3.7   limited liability company or its members by reason of being or 
  3.8   having been a governor of the limited liability 
  3.9   company.  Nothing in this section creates liability to a person 
  3.10  other than the limited liability company or a member.  
  3.11     Sec. 5.  Minnesota Statutes 2002, section 322B.663, 
  3.12  subdivision 5, is amended to read: 
  3.13     Subd. 5.  [CONSIDERATIONS.] In discharging the duties of 
  3.14  the position of governor, a governor may must, in considering 
  3.15  determining the best interests of the limited liability company, 
  3.16  consider: 
  3.17     (1) the interests of the limited liability 
  3.18  company's members, employees, customers, suppliers, and 
  3.19  creditors, and other persons affected by the activities of the 
  3.20  limited liability company; 
  3.21     (2) the economy of communities in which an office or 
  3.22  facility of the limited liability company is located, the state, 
  3.23  and nation,; 
  3.24     (3) community and societal considerations, including the 
  3.25  effect of the activities of the corporation on environmental 
  3.26  quality, public health, or safety; and 
  3.27     (4) the long-term as well as short-term interests of the 
  3.28  limited liability company and, its members, and other persons 
  3.29  affected by the activities of the limited liability company, 
  3.30  including the possibility that these interests may be best 
  3.31  served by the continued independence of the limited liability 
  3.32  company. 
  3.33     Sec. 6.  Minnesota Statutes 2002, section 322B.69, is 
  3.34  amended to read: 
  3.35     322B.69 [STANDARD OF CONDUCT.] 
  3.36     A manager shall discharge the duties of an office in good 
  4.1   faith, in a manner the manager reasonably believes to be in the 
  4.2   best interests of the limited liability company, and with the 
  4.3   care an ordinarily prudent person in a like position would 
  4.4   exercise under similar circumstances.  A person exercising the 
  4.5   principal functions of an office or to whom some or all of the 
  4.6   duties and powers of an office are delegated pursuant to section 
  4.7   322B.689 is considered a manager for purposes of this section 
  4.8   and sections 322B.38 and 322B.699.  In determining the best 
  4.9   interests of the limited liability company, a manager must 
  4.10  consider the factors in section 322B.663, subdivision 5.  
  4.11  Nothing in this section creates liability to a person other than 
  4.12  the limited liability company or a member.