Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Corporate Governance topic
No spam. Unsubscribe anytime.
House considers changes to corporate governance aimed at protecting Utah companies from hostile takeovers
Summary
Representative Val Peterson told the House HB 41 would give boards a 'broad constituency' standard and add protections for acquisitions exceeding 20% ownership; the bill would allow companies to opt out via articles of incorporation and mirrors provisions already adopted in other states.
Representative Val Peterson presented House Bill 41 to modify the Utah Revised Business Corporation Act, saying the bill prepares "a way so that companies aren't as easily subject to hostile takeover." He described two primary provisions: a 'broad constituency' standard allowing boards to consider employees, location and other factors besides shareholder price, and a set of protections that require conditions when a buyer seeks more than 20 percent ownership, including board approval, disinterested shareholder votes, or a fair-market-value formula.
Peterson said 32 states have adopted similar provisions and that companies may opt out by specifying that choice in their articles of incorporation. The sponsor framed the changes as optional protections to preserve the long-term viability of Utah firms.
No recorded floor amendments or a final vote on HB 41 are present in the supplied transcript segments; the sponsor completed his presentation and the bill was placed for consideration per regular order.
