(1) Advertise that it is receiving or accepting money on deposit.

(2) Use a sign at its place of business containing words indicating that the place is a place of business:

(a) Of a banking institution;

(b) Where deposits are received or payments made on check; or

(c) Where any other form of banking business is transacted.

(3) Make use of or circulate any letterheads, blank notes, blank receipts, certificates, circulars or any written or printed paper containing words indicating that the business is the business of a banking institution.

(4) Transact business under any name that the director determines leads the public to believe that its business is that of a banking institution or that it is affiliated with a banking institution.

(5) Solicit or receive deposits or transact business in the manner of a banking institution or in such a manner as to lead the public to believe that its business is that of a banking institution. [Amended by 1973 c.797 §51; 1997 c.631 §30]

(2) The banking institution may be organized under this section by one or more persons or a corporation.

(2) The initial paid-in capital of an institution or Oregon stock savings bank must be paid either in cash or by exchange of real property and improvements thereon. The real property and improvements must be approved by the director as meeting all applicable requirements of law and all other conditions and standards that the director adopts by rule, including but not limited to a proper appraisal by a qualified appraiser. [Amended by 1963 c.195 §3; 1973 c.797 §53; 1985 c.786 §24; 1997 c.631 §33]

(1) The proposed location of the initial principal place of business.

(2) The class or classes of stock proposed to be issued, the proposed offering price per share and the aggregate dollar amount of the proposed initial paid-in capital.

(3) The corporate name.

(4) The names of the proposed senior officers and the initial directors, at least three of whom shall also be among the incorporators.

(5) The residence addresses and occupations of the proposed incorporators and directors.

(a) Shall not contain any word or phrase that indicates or implies that it is organized for any purpose other than one or more of the purposes contained in its articles of incorporation.

(a) The purposes of the proposed banking institution as stated in the proposed banking institution’s articles of incorporation and the application are consistent with the Bank Act;

(b) The character, financial responsibility and general fitness of the persons named in the application are such as to command the confidence of the community in which the proposed banking institution is to be located and to warrant the belief that the business of the proposed corporation will be honestly and efficiently conducted;

(c) The proposed directors and officers are competent to manage successfully a banking institution;

(d) The suggested capitalization is adequate for the proposed banking institution’s anticipated development and growth within a reasonable period of time; and

(e) There is reasonable assurance of sufficient volume of business for the proposed banking institution to be economically viable.

(2) If the director is satisfied that the applicant meets the standards prescribed in subsection (1) of this section the director shall note the approval and the date on each copy of the application. If the director is not satisfied or believes that the public interest will be endangered the director shall note the disapproval of the director and the date on each copy of the application.

(3) The director shall acknowledge receipt of an application and shall notify the applicants of approval or disapproval of the application. The director shall file the original of an approved application in the office of the director.

(4) The director shall act to approve or disapprove an application within 60 days from receipt of the application, unless a majority of the applicants and the director agree to extend the time an additional 30 days.

(5) The director may grant conditional approval of any application and require the applicants to make additional showing or changes in the proposed banking institution as the director considers advisable.

(6) The applicants may appeal the decision of the director to any court of appropriate jurisdiction. [Amended by 1973 c.797 §55; 1975 c.544 §8a; 1997 c.631 §40]

(2) The articles of incorporation shall specify:

(a) The name of the institution or Oregon stock savings bank.

(b) The initial principal place where its business is to be transacted, designated by legal description or street and number in the city or town.

(c) The names of the prospective incorporators.

(d) The term of its existence, which may be perpetual.

(e) The purpose for which the institution or Oregon stock savings bank is formed.

(f) The initial board of directors of the institution or Oregon stock savings bank, composed of not fewer than five persons, at least three of whom shall be prospective incorporators.

(g) If the stockholders will have preemptive rights, a statement of such rights.

(3) In addition, the articles of incorporation:

(a) Indorse on each of the duplicate originals the word "Filed," and the month, day and year of the filing.

(b) File one of the duplicate originals in the office of the director.

(c) Issue a certificate of incorporation to which the director shall affix the other duplicate original.

(2) The certificate of incorporation, with one of the duplicate originals affixed thereto shall be returned to the incorporators or their representative.

(3) Upon issuance of the certificate of incorporation the corporate existence of a banking institution begins. [Amended by 1973 c.797 §59; 1997 c.631 §44]

(a) A list of stockholders, showing name, address, number of shares and amount paid, certified by the president or cashier.

(b) A certificate of any escrow agent holding moneys in escrow as payment for subscriptions to stock of the institution or Oregon stock savings bank showing the amount held.

(c) A list of the directors and senior officers elected.

(d) A copy of its bylaws certified to by its president or cashier.

(e) Evidence of approval by the Federal Deposit Insurance Corporation of the Oregon commercial bank’s or Oregon stock savings bank’s application for deposit insurance.

(2) Upon receiving the items referred to in subsection (1) of this section, the director shall examine the condition of the institution or Oregon stock savings bank. If, upon examination, the director determines that the institution or Oregon stock savings bank has complied with the requirements of the Bank Act and that the amount of the institution’s or Oregon stock savings bank’s initial paid-in capital has been paid or is held in escrow for release upon issuance of a charter, the director shall issue to the institution or Oregon stock savings bank a charter, which, depending on the form of the application and the approval of the director, shall be to do a banking business either as an Oregon commercial bank or as an Oregon stock savings bank, or to do a trust business, or to do both a banking and trust business. [Amended by 1973 c.797 §61; 1987 c.216 §2; 1997 c.631 §47]

(1) Is insolvent, either in the sense that the person’s liabilities exceed the person’s assets or that the person cannot meet the person’s obligations as they mature, or is in such financial condition that the person cannot continue in business with safety to the person’s customers;

(2) Has engaged in dishonest, fraudulent or illegal practices or conduct in any business or profession;

(3) Has willfully or repeatedly violated or failed to comply with any provisions of the Bank Act or any rule or order of the director;

(4) Has been convicted of a crime, an essential element of which is fraud;

(5) Is not qualified to conduct a banking business on the basis of such factors as training, experience and knowledge of the business;

(6) Is permanently or temporarily enjoined by a court of competent jurisdiction from engaging in or continuing any conduct or practice involving any aspect of the banking business or other business that may lawfully be conducted by an insured institution;

(7) Is the subject of an order of the director subjecting the person to a fine or a civil penalty, or removing the person from an office in any entity regulated by the director; or

(8) Is the subject of an order entered within the past five years, directing the person to cease and desist from any fraudulent or unlawful business or banking practice, subjecting the person to a fine or other civil penalty, or removing the person from an office in a financial institution or a consumer finance company issued by the banking supervisor of another state or by the Comptroller of the Currency, the Board of Governors of the Federal Reserve System or by any other agency of the federal government or another state with regulatory authority over such financial institutions or consumer finance companies. [1977 c.135 §19; 1985 c.762 §§37,37a; 1985 c.786 §25; 1987 c.373 §52; 1997 c.631 §48]

(a) Any person required to be named in the application to organize.

(b) Any person named in the proposed articles of incorporation of the banking institution or documents submitted for filing as a prospective incorporator or as a director, president or chief executive officer of the banking institution.

(2) Fingerprints acquired under subsection (1) of this section may be submitted to appropriate law enforcement agencies, including the Federal Bureau of Investigation, for the purpose of discovering any unlawful activities of the person. [1985 c.786 §23; 1997 c.631 §50]

(2) An institution or Oregon stock savings bank that fails to obtain paid subscriptions in at least the amount of its approved initial paid-in capital and complete its organization and receive from the director a charter, within one year after the date of approval of its articles of incorporation, ceases to exist and the articles of incorporation are void.

(3) All persons purporting to act as or on behalf of a banking institution, knowing there was no incorporation, are jointly and severally liable for all liabilities created while so acting. [Amended by 1969 c.44 §1; 1973 c.797 §63; 1989 c.324 §5; 1997 c.631 §51]

(2) A banking institution shall commence business on the effective date specified in its charter. If a banking institution fails to commence business on the effective date specified in the charter or according to any extension of time granted by the director it ceases to exist and its articles of incorporation and charter are void. [Amended by 1973 c.797 §64; 1997 c.631 §52]

(2) The stock ledger or register shall be available for inspection and copying, during regular business hours at a reasonable location specified by the institution or Oregon stock savings bank, by a stockholder of the institution or Oregon stock savings bank upon at least five days’ prior written notice if:

(a) The stockholder’s demand for inspection is made in good faith and for a proper purpose;

(b) The stockholder described with reasonable particularity the stockholder’s purpose; and

(c) The stock ledger or register requested is directly connected to the stockholder’s purpose. [Amended by 1973 c.797 §69; 1997 c.631 §56]

(Amendment of Articles of Incorporation)

(2) In particular, and without limitation upon such general power of amendment, an institution or Oregon stock savings bank may amend its articles of incorporation, from time to time, so as:

(a) To change its corporate name.

(b) To change its period of duration.

(c) To change, enlarge or diminish its corporate purposes.

(d) To increase or decrease the aggregate number of shares, or shares of any class, which the institution or Oregon stock savings bank has authority to issue.

(e) To exchange, classify, reclassify or cancel all or any part of its shares, whether issued or unissued.

(f) To change the designation of all or any part of its shares, whether issued or unissued, and to change the preferences, limitations and relative rights in respect to all or any part of its shares, whether issued or unissued.

(g) To change the shares of any class, whether issued or unissued, into a different number of shares of the same class or into the same or a different number of shares of other classes.

(h) To create new classes of shares with rights and preferences either prior and superior or subordinate and inferior to the shares of any class then authorized, whether issued or unissued.

(i) To cancel or otherwise affect the right of the holders of the shares of any class to receive dividends which have accrued but have not been declared.

(j) To divide any class of shares, whether issued or unissued, into series and fix and determine the designations of such series and the variations in the relative rights and preferences as between the shares of such series.

(k) To authorize the board of directors to establish, out of authorized but unissued shares, series of any class of shares and fix and determine the relative rights and preferences of the shares of any series so established.

(L) To authorize the board of directors to fix and determine the relative rights and preferences of the authorized but unissued shares of series theretofore established in respect to which either the relative rights and preferences have not been fixed and determined or the relative rights and preferences theretofore fixed and determined are to be changed.

(m) To revoke, diminish or enlarge the authority of the board of directors to establish series out of authorized but unissued shares of any class and fix and determine the relative rights and preferences of the shares of any series so established.

(n) To limit, deny or grant to shareholders of any class the preemptive right to acquire additional or treasury shares of the institution or Oregon stock savings bank, whether then or thereafter authorized. [1989 c.324 §10; 1997 c.631 §59]

(1) If an institution or Oregon stock savings bank has issued shares of stock:

(a) The board of directors shall adopt a resolution setting forth the proposed amendment and directing that it be submitted to a vote at a meeting of shareholders, which may be either an annual or a special meeting.

(b) Written or printed notice setting forth the proposed amendment or a summary of the changes to be effected shall be given to each shareholder of record entitled to vote within the time and in the manner provided in this chapter for giving notice of meetings of shareholders. If the meeting is an annual meeting, the proposed amendment or such summary may be included in the notice of such annual meeting.

(c) At such meeting, a vote of the shareholders entitled to vote thereon shall be taken on the proposed amendment. The proposed amendment shall be adopted upon receiving the affirmative vote of the holders of at least a majority of the shares entitled to vote thereon, unless any class of shares is entitled to vote thereon as a class, in which event the proposed amendment shall be adopted upon receiving the affirmative vote of the holders of at least a majority of the shares of each class of shares entitled to vote thereon as a class and of the total shares entitled to vote thereon.

(2)(a) If an institution or Oregon stock savings bank has not issued any shares of stock, the articles of incorporation may be amended by resolution adopted by a majority of the directors.

(b) If the provisions of the articles of incorporation relating to the duration, purposes, authorized shares, rights or preferences of shares, or internal affairs of the institution or Oregon stock savings bank are amended by the directors prior to the issuance of stock, the directors shall immediately notify in writing each person who is a party to any agreement for the subscription of stock of the institution or Oregon stock savings bank. Such notice shall set forth the text of the amendment and state that the subscriber may, within 30 days after delivery or mailing of the notice of amendment, rescind the subscriber’s subscription by notice in writing delivered or mailed to the directors at an address specified. If a notice of rescission is not delivered or mailed within 30 days, the subscriber may not thereafter assert the fact of the amendment as the basis for avoiding the subscription agreement or asserting any claim against any person.

(3) Any number of amendments may be submitted to the shareholders or directors and voted upon by them at one meeting. [1989 c.324 §11; 1997 c.631 §60]

(a) Increase or decrease the aggregate number of authorized shares of such class.

(b) Effect an exchange, reclassification or cancellation of all or part of the shares of such class.

(c) Effect an exchange, or create a right of exchange, of all or any part of the shares of another class into the shares of such class.

(d) Change the designations, preferences, limitations or relative rights of the shares of such class.

(e) Change the shares of such class into the same or a different number of shares of the same class or another class or classes.

(f) Create a new class of shares with rights and preferences prior and superior to the shares of such class, or increase the rights and preferences of any class with rights and preferences prior or superior to the shares of such class.

(g) Divide the shares of such class into series and fix and determine the designation of such series and the variations in the relative rights and preferences between the shares of such series or authorize the board of directors to do so.

(h) Limit or deny the existing preemptive rights of the shares of such class.

(i) Cancel or otherwise affect dividends on the shares of such class which had accrued but had not been declared.

(2) Different series of the same class of shares shall not constitute different classes of shares for the purpose of voting by classes upon a proposed amendment, except when a series will be adversely affected by an amendment in a manner different from other shares of the same class. [1989 c.324 §12; 1997 c.631 §61]

(1) The name of the institution or Oregon stock savings bank.

(2) If the amendment alters or changes any provision of the original or amended articles of incorporation, an identification by reference or description of the affected provision and a statement of its text as it is amended to read. If the amendment strikes or deletes any provision of the original or amended articles of incorporation, an identification by reference or description of the provision so stricken or deleted and a statement that it is stricken or deleted. If the amendment is an addition to the original or amended articles of incorporation, a statement of that fact and the full text of each provision added.

(3) The date of the adoption of the amendment by the shareholders.

(4) The number of shares outstanding and the number of shares entitled to vote thereon, and if the shares of any class are entitled to vote thereon as a class, the designation and number of outstanding shares entitled to vote thereon of each such class.

(5) The number of shares voted for and against such amendment, respectively, and, if the shares of any class are entitled to vote thereon as a class, the number of shares of each such class voted for and against such amendment, respectively.

(6) If such amendment provides for an exchange, reclassification or cancellation of issued shares, and, if the manner in which the same shall be effected is not set forth in the amendment, a statement of the manner in which the same shall be effected.

(1) Indorse on each such duplicate originals the word "Filed" and the month, day and year of the filing thereof.

(2) File one of such duplicate originals in the office of the director.

(3) Return one duplicate original of the articles of amendment to the banking institution or its representative. [1989 c.324 §14; 1997 c.631 §63]

(2) No amendment shall affect any existing cause of action in favor of or against such banking institution, any pending suit to which such banking institution shall be a party or the existing rights of persons other than shareholders. In the event the corporate name shall be changed by amendment, no suit brought by or against such banking institution under its former name shall abate for that reason. [1989 c.324 §15; 1997 c.631 §64]

(a) Issue fractions of a share or pay in money the value of fractions of a share;

(b) Arrange for disposition of fractional shares by the shareholders; or

(c) Issue scrip in registered or bearer form entitling the holder to receive a full share upon surrendering enough scrip to equal a full share.

(2) Each certificate representing scrip must be conspicuously labeled "scrip" and must contain the following information:

(a) The name of the issuing institution or Oregon stock savings bank and a statement that it is organized under the law of this state;

(b) The name of the person to whom the scrip is issued; and

(c) The number and class of shares and the designation of the series, if any, for which the certificate may be exchanged.

(3) The holder of a fractional share is entitled to exercise the rights of a shareholder, including the right to vote, receive dividends and participate in the assets of the institution or Oregon stock savings bank upon liquidation. The holder of scrip is not entitled to any of these rights unless the scrip provides for them.

(4) The board of directors may authorize the issuance of scrip subject to any condition considered desirable, including:

(a) That the scrip will become void if not exchanged for full shares before a specified date; or

(b) That the shares for which the scrip is exchangeable may be sold and the proceeds paid to the scripholders. [1989 c.324 §32; 1997 c.631 §67]

(2) The rights or options described in subsection (1) of this section may not be issued to a director, officer or employee of the institution or Oregon stock savings bank or of any subsidiary thereof unless the issuance:

(a) Is to all shareholders of the institution, Oregon stock savings bank or subsidiary thereof;

(b) Is approved at the annual meeting or a special meeting by the holders of at least two-thirds of the outstanding shares entitled to vote thereon; or

(c) Is pursuant to a plan previously so approved.

(3) In the absence of fraud in the transaction, the judgment of the board of directors as to the adequacy of the consideration received for the rights or options described in subsection (1) of this section shall be conclusive. [1989 c.324 §29; 1997 c.631 §68; 2001 c.377 §58]

(2) The statement of cancellation shall be executed in duplicate by the institution or Oregon stock savings bank by an authorized officer and shall set forth:

(a) The name of the institution or Oregon stock savings bank.

(b) The number of shares canceled through redemption, itemized by classes and series.

(c) The number of shares that the institution or Oregon stock savings bank has authority to issue, itemized by classes and series, after giving effect to such cancellation.

(3) Duplicate originals of such statement shall be submitted to the Director of the Department of Consumer and Business Services for filing. If the director finds that such statement conforms to law, the director shall, when all fees and charges have been paid as prescribed by this chapter:

(a) Indorse on each duplicate original the word "Filed" and the month, day and year of the filing thereof.

(b) File one duplicate original in the office of the director.

(c) Return the other duplicate original to the institution or Oregon stock savings bank or its representative.

(4) Nothing contained in this section shall be construed to forbid a cancellation of shares or a reduction in the number of authorized shares of any class in any other manner permitted by the Bank Act. [1989 c.324 §34; 1997 c.631 §71]

(2) An institution or Oregon stock savings bank may, by resolution of its board of directors and with the approval of the Director of the Department of Consumer and Business Services, apply part of its paid-in capital to the reduction or elimination of any deficit in retained earnings arising from losses.

(3) An institution or Oregon stock savings bank may, by resolution of its board of directors, create a reserve or reserves out of its retained earnings for any proper purpose or purposes and may abolish any such reserve in the same manner. Retained earnings of the institution or Oregon stock savings bank to the extent so reserved shall not be available for the payment of dividends or other distributions by the institution or Oregon stock savings bank except as expressly permitted by the Bank Act.

(4) An institution or Oregon stock savings bank may redeem shares of its stock only with the prior approval of the director. A class or series of shares may be designated redeemable upon certain terms and conditions in advance of its issuance with the prior approval of the director, in which event no further approval shall be required to redeem the shares in accordance with the terms and conditions approved.

(5) The director may refuse to approve a reduction in paid-in capital under subsection (2) of this section or redemption of shares under subsection (4) of this section if the director determines that the remaining paid-in capital of the institution or Oregon stock savings bank would be inadequate for the safe and sound operation of the institution or Oregon stock savings bank.

(6) The director may by rule or order waive the requirement for prior approval of redemptions of shares. [1989 c.324 §35; 1997 c.631 §72]

(2) Notwithstanding subsection (1) of this section, an institution or Oregon stock savings bank shall have the power to create and issue the number of shares of stock stated in its articles of incorporation or the amendments thereto. [Amended by 1969 c.635 §2; 1973 c.797 §76; 1977 c.135 §16; 1983 c.37 §4; 1997 c.631 §73]

(1) All bad debts, which are debts on which interest is past due and unpaid for at least six months, unless the debt is fully secured and in the process of collection.

(2) All other assets charged off as required by the Director of the Department of Consumer and Business Services or a state or federal examiner.

(3) All accrued expenses, interest and taxes of the institution or Oregon stock savings bank. [Amended by 1973 c.797 §79; 1997 c.631 §74]

STOCKHOLDERS, DIRECTORS AND OFFICERS

(Stockholder Meetings)

(2) Attendance at a meeting by a shareholder waives objection to:

(a) Lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting objects to the holding of the meeting or the transacting of business at the meeting; and

(b) Consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented. [1989 c.324 §51; 1997 c.631 §81]

(2) In lieu of closing the stock transfer books, the bylaws or, in the absence of an applicable bylaw, the board of directors may fix in advance a date as the record date for any such determination of shareholders. The record date, in any case, shall be not more than 70 days and, in the case of a meeting of shareholders, not less than 10 days prior to the date on which the particular action, requiring such determination of shareholders, is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders, or shareholders entitled to receive payment of a dividend, the close of business on the business day before the date on which notice of the meeting is mailed or the date on which the resolution of the board of directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of shareholders.

(3) When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this section, such determination shall apply to any adjournment thereof, unless the meeting is adjourned to a date more than 120 days from the original meeting date. [1989 c.324 §44; 1997 c.631 §82]

(2) Failure to comply with the requirements of this section shall not affect the validity of any action taken at such meeting. [1989 c.324 §45; 1997 c.631 §83]

(2) Neither shares of its own stock held by the institution or Oregon stock savings bank in a fiduciary capacity, nor shares held by another corporation if a majority of the shares entitled to vote for the election of directors of such other corporation is held by the institution or Oregon stock savings bank shall be voted at any meeting or counted in determining the total number of outstanding shares at any given time. The prohibition of this subsection does not apply if, under the terms of a trust in which such shares are held, the manner in which such shares shall be voted may be determined by the trustee, by a donor or beneficiary of the trust or by some other person named in the trust, and such shares are actually voted in the manner determined or directed by the trustee, donor, beneficiary or other person so authorized.

(3) A shareholder may vote either in person or by proxy executed in writing by the shareholder or by the shareholder’s duly authorized attorney in fact. No proxy shall be valid after 11 months from the date of its execution, unless otherwise provided in the proxy.

(4) In electing each director for whose election the shareholder has a right to vote, every shareholder entitled to vote at such election shall have the right to vote, either in person or by proxy, the number of shares owned by the shareholder. If the articles of incorporation specifically permit cumulative voting, every shareholder shall have the right to cumulate the shareholder’s votes either by giving one candidate as many votes as the number of such directors multiplied by the number of the shareholder’s shares shall equal or by distributing such votes on the same principle among any number of such candidates.

(5) Shares standing in the name of another domestic or foreign corporation, a limited liability company, a partnership or another entity may be voted by such officer, agent or proxy as the governing documents of the entity may prescribe or, in absence of such provision, as the board of directors or other governing body of the entity holding the shares may determine.

(6) Shares held by a personal representative, administrator, executor, guardian or conservator may be voted by such person, either in person or by proxy, without a transfer of such shares into such person’s name. Shares standing in the name of a trustee may be voted by the trustee, either in person or by proxy, but no trustee shall be entitled to vote shares held by the trustee without a transfer of the shares to the name of the trustee.

(7) Shares standing in the name of a receiver may be voted by such receiver, and shares held by or under control of a receiver may be voted by such receiver without a transfer into the receiver’s name if authority to do so is contained in an appropriate order of the court by which such receiver was appointed.

(8) Shares may be voted by a pledgee or attorney-in-fact of the shareholder if authorized by the pledge agreement or power of attorney and evidence of such authority is presented to the institution or Oregon stock savings bank upon request.

(9) On and after the date on which written notice of redemption of shares has been mailed to the holders thereof and a sum sufficient to redeem such shares has been deposited with another institution or Oregon stock savings bank with irrevocable instruction and authority to pay the redemption price to the holders thereof upon surrender of certificates therefor, such shares shall not be entitled to vote on any matter and shall not be deemed to be outstanding shares. [1989 c.324 §47; 1997 c.631 §84]

(2) Once a share is represented at a meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for that adjourned meeting. [1989 c.324 §46; 1997 c.631 §86]

(2) An amendment to the articles of incorporation that adds a greater quorum or voting requirement must meet the quorum requirement and be adopted by the vote and voting groups required to take action under the quorum and voting requirements then in effect. An amendment to the articles of incorporation that changes or deletes a greater quorum or voting requirement must meet the quorum requirement and be adopted by the vote and voting groups required to take action immediately prior to the change or deletion. [1989 c.324 §48; 1997 c.631 §87]

(Directors and Officers)

(2) No committee shall have the authority of the board of directors in reference to:

(a) Amending the articles of incorporation;

(b) Approving dividends or other distributions to shareholders of an institution or Oregon stock savings bank;

(c) Filling vacancies on the board of directors or on any of its committees;

(d) Approving the reacquisition of shares of the institution or Oregon stock savings bank;

(e) Adopting a plan of merger or consolidation;

(f) Recommending to the shareholders the sale, lease, exchange, mortgage, pledge or other disposition of all or substantially all the property and assets of the institution or Oregon stock savings bank other than in the usual and regular course of its business;

(g) Recommending to the shareholders a voluntary dissolution of the institution or Oregon stock savings bank or a revocation thereof;

(h) Amending the bylaws of the banking institution; or

(i) Approving the issuance or sale or contract for sale of shares or determining the designation and relative rights, preferences and limitations of a class or series of shares of the institution or Oregon stock savings bank.

(3) Notwithstanding subsection (2) of this section, the board of directors may authorize a committee to take action described in subsection (2)(i) of this section pursuant to a stock option or other stock compensation plan, or by approving the maximum number of shares to be issued and delegating to the committee the authority to determine all or any part of the terms of the issuance or sale or contract of sale and the determination of the designation and relative rights, preferences and limitations of the class or series of shares.

(4) The designation of committees and the delegation thereto of authority shall not operate to relieve the board of directors, or any member thereof, of any responsibility imposed upon the board of directors or such member by law. [1989 c.324 §50; 1997 c.631 §90]

(2) If the institution or Oregon stock savings bank has cumulative voting, terms of directors may be staggered only if authorized by the articles of incorporation, and no class shall have fewer than three members. [1989 c.324 §26; 1997 c.631 §91]

(2) If a director is elected by a voting group of shareholders, only the shareholders of that voting group may participate in the vote to remove the director.

(3) If cumulative voting is authorized, a director may not be removed if the number of votes sufficient to elect the director under cumulative voting is voted against the director’s removal. If cumulative voting is not authorized, a director may be removed only if the number of votes cast to remove the director exceeds the number of votes cast not to remove the director.

(4) A director may be removed by the shareholders only at a meeting called for the purpose of removing the director, and the meeting notice must state that the purpose, or one of the purposes, of the meeting is removal of the director. [1989 c.324 §49]

(a) One or more officers or employees of the banking institution whom the director reasonably believes to be reliable and competent in the matters presented;

(b) Legal counsel, public accountants or other persons as to matters the director reasonably believes are within the person’s professional or expert competence; or

(c) A committee of the board of directors of which the director is not a member, if the director reasonably believes the committee merits confidence.

(2) A director is not acting in good faith if the director has knowledge concerning a matter in question that makes reliance otherwise permitted by subsection (1) of this section unwarranted.

(3) When evaluating any offer of another party to make a tender or exchange offer for any equity security of the banking institution, or any proposal to merge the banking institution with another banking institution or to purchase or otherwise acquire all or substantially all the properties and assets of the banking institution, the directors of a banking institution may, in determining what the directors believe to be in the best interests of the banking institution, give due consideration to the social, legal and economic effects on employees, customers and suppliers of the banking institution and on the communities and geographical areas in which the banking institution and its subsidiaries operate, the economy of the state and nation, the long term as well as short term interests of the banking institution and its stockholders, including the possibility that these interests may be best served by the continued independence of the banking institution, and other relevant factors. [Amended by 1973 c.797 §88; 1975 c.725 §7; 1997 c.631 §92]

(a) One or more officers or employees of the banking institution whom the officer reasonably believes to be reliable and competent in the matters presented; or

(b) Legal counsel, public accountants or other persons as to matters the officer reasonably believes are within the person’s professional or expert competence.

(2) An officer is not acting in good faith if the officer has knowledge concerning the matter in question that makes reliance otherwise permitted by subsection (1) of this section unwarranted. [1997 c.631 §94]

(b) Unless paragraph (c) of this subsection is applicable, the board of directors shall hold a regular meeting at least once every month.

(c) Notwithstanding paragraph (b) of this subsection, with the approval of the Director of the Department of Consumer and Business Services, the board of directors of a banking institution may hold regular meetings as infrequently as once each calendar quarter.

(2) A quorum at any meeting of the board of directors shall consist of:

(a) If the banking institution has a fixed board size, a majority of the members of the whole board.

(b) If the banking institution has a variable-range board size, a majority of the number of directors prescribed or, if no number is prescribed, a majority of the number in office immediately before the meeting begins.

(3) If less than a quorum of directors is present at a meeting, they may adjourn until the next meeting.

(4) If a quorum is present when a vote is taken, the affirmative vote of a majority of directors present is the act of the board of directors unless the articles of incorporation or bylaws require the vote of a greater number of directors.

(5) Meetings of the board of directors, regular or special, may be held either within or without this state.

(6) Meetings of the board of directors shall be held upon such notice as is prescribed in the bylaws. Attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at nor the purpose of any meeting of the board of directors need be specified in the notice or waiver of notice of such meeting unless required by the bylaws or by law.

(7) Unless otherwise restricted by the articles of incorporation or bylaws, members of the board of directors of a banking institution or any committee designated by the board may hold a meeting of the board or committee by means of conference telephone or similar communications equipment that allows all persons participating in the meeting to hear each other. Participation in a meeting under this subsection shall constitute presence in person at the meeting. [Amended by 1963 c.166 §1; 1973 c.797 §89; 1983 c.296 §4; 1989 c.324 §40; 1993 c.255 §1; 1997 c.631 §95]

(2) The board of directors may define the duties, fix the compensation, dismiss, fill vacancies and require bonds or irrevocable letters of credit for the faithful performance of the duties of the employees and officers of the banking institution.

(3) In the event the board dismisses an officer, the officer shall no longer serve as a director.

(4) Any officer or agent elected or appointed by the board of directors may be removed by the board of directors whenever, in its judgment, the best interests of the banking institution will be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed. Election or appointment of an officer or agent shall not of itself create contract rights. [Amended by 1973 c.797 §92; 1983 c.37 §6; 1985 c.786 §32; 1989 c.324 §41; 1991 c.331 §110; 1997 c.631 §99]

(2) The director shall investigate each person whose name is submitted under this section to determine the character, honesty, financial responsibility and competence of the person. In the course of investigating any person under this section, the director may require the person to provide additional information for the director’s further inquiry. For the purpose of such further inquiry, the director may require the person to submit to fingerprinting. Fingerprints acquired under this subsection may be submitted to appropriate law enforcement agencies, including the Federal Bureau of Investigation, for the purpose of discovering any unlawful activities of the person.

(2) The director may issue an order of removal under subsection (1) of this section:

(2) If the matter is referred to a district attorney or to the Attorney General, such officer promptly shall investigate the violation and institute such action against the person as the information and investigation requires or justifies. The cost of the investigation and action shall be paid by the county or state in the manner in which other criminal actions are paid. [1979 c.88 §7; 1997 c.631 §104]

(Indemnification of Directors, Officers, Employees and Agents)